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by patmcc 547 days ago
>>You're oversimplifying this. If someone owes you $1B and they owe me $2B, and they've got an asset worth $500M, I can't just pledge $2B of bad debt to buy the asset. The only fair way is to sell it for $500M in actual cash. Then it gets divied up accordingly.

Except what if all the creditors prefer that outcome to the "more cash" outcome? If the way it would get divvied up is $499m to you and $1m to me, vs $350m to you and $50m to me (but you get some other benefit that you prefer), why shouldn't that be accepted?
1 comments
wakawaka28 547 days ago
If literally every creditor agreed, maybe so. But I don't think that is the case even among the subset of creditors that is the families. If there are banks involved I'm sure they aren't interested in getting less money.
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patmcc 547 days ago
The two groups of families are the only two creditors. The Connecticut families are owed ~$1bil, the Texas families are owed ~$50mil. Nobody else is getting any money.

The bid that was accepted would give the Texas families more than they would have gotten from the other bid, because the Connecticut families were willing to give it to them, because they valued stripping Jones of his platform higher than the cash.

The only people worse off are the people who submitted the losing bid (Alex Jones' cronies). The creditors, and the estate, were not. And they're the ones the bankruptcy Trustee has the highest duty to.

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pclmulqdq 547 days ago
> Nobody else is getting any money.

It is impossible to infer this simply from the size of the debt. Debts have seniority ordering which dictates who gets paid first, just like liquidation preferences in startups.

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patmcc 547 days ago
Sorry, I was imprecise (and not meaning that it was due to the size of the debt alone).

There are 3 sets of creditors that have potential claims in these proceedings, based on what I can find. The two groups of plaintiffs from the different trials (Connecticut families and Texas families, although there's at least one FBI agent that's part of one of those cases too) and American Express - Jones owes them ~$150k in credit card debt. AmEx is not pushing for this money, for obvious reasons (they wouldn't get it, and it would look bad).

No one in this case is disputing that the money is going to end up with the Sandy Hook families. It's entirely the other bidder in the auction that took this back to the judge.

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