Government

Gateway Pundit Bounced From Bankruptcy For Bad Faith

Their court filings were just as accurate as their articles!

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Bankruptcy document with wooden gavelThis morning, a judge in Florida issued a scathing ruling booting conservative trollsite The Gateway Pundit out of bankruptcy. It’s the latest episode of Conservative Misadventures in the Land of Bankruptcy, and this one’s a banger.

The Gateway Pundit (TGP), which is like Infowars, but spammier and lower energy, was founded in 2004 by a very weird dude named Jim Hoft who aimed to “expose the wickedness of the left.” Soon he and his twin brother Joe were minting money as one of the go-to “news” sources on the right. According to the court’s order, TGP earns revenues of approximately $3 million annually by flogging baldness cures and articles warning that “The Choice of Kamala Makes No Sense. It’s a Terrible Mistake. But Democrats Have Something Up Their Sleeve. Something Very Evil and Shocking is Coming.”

Unsurprisingly, they were all in on Trump’s lies about election fraud, including the false claims about Atlanta poll workers Ruby Freeman and Shaye Moss, as well as conspiracy theories concerning about a former Dominion Voting Systems Executive named Eric Coomer. Which is how TGP wound up on the pointy end of a couple of monster defamation suits in state courts in Missouri (where TGP is/was domiciled) and Colorado (where Coomer lives).

Like Alex Jones and Rudy Giuliani, TGP raced into what Hoft hoped would be the warm embrace of the bankruptcy court. And like his fellow travelers in the land of hate, Hoft found it rather less salubrious than he had imagined.

The case was filed in Florida, where Hoft claimed to have moved in 2021, living at least part of the year in a condo purchased for $800,000 “pursuant to an undocumented, interest-free loan” from TGP.

“Taking Hoft’s sworn testimony at face value, TGP has been doing business in the state of Florida for approximately 3 years without a local business license,” US Bankruptcy Judge Mindy Mora notes, observing in a footnote that “It is possible that TGP owes back taxes due to its failure to timely disclose its status as a foreign entity conducting business within the state of Florida.”

Hoft also drives a Porsche which is nominally owned by TGP, and he uses the company’s website to solicit donations to something called “The Justice League,” an entity separate from TGP which is wholly controlled by Hoft.

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As the court observes, “TGP’s known, easily reachable assets are over 22 times greater than its liabilities,” and it could demand repayment of loans to Hoft and his brother in excess of $1 million. Nevertheless, Hoft’s proposed plan of reorganization would obviate his personal liability in the civil suits and allow him to keep on not reimbursing the company for money owed. Instead, he hopes to fob the plaintiffs off with three years of net income from the business, leaving him free to continue spewing his uniquely profitable brand of bile.

The state court plaintiffs counter that the case should be dismissed, sending Hoft and TGP back to answer to a jury for his malicious torts.

“The State Court Litigation challenges The Gateway Pundit’s brash (and allegedly not fact-checked) reporting style, which may in turn compromise its profitability,” Judge Mora writes. “If a court determines that statements in the Articles are defamatory, then The Gateway Pundit might choose to adopt a more restrained editorial style. That choice could lead to fewer website views, which would likely soften revenue. ”

Judge Mora was particularly irked at Hoft’s claim that allowing him to avoid exhausting his $2 million media insurance policy would somehow redound to the benefit of his creditors. She also cast extreme judicial side eye at the claim that the site’s writers, who are creditors of the estate, must remain anonymous, noting that “TGP made this request despite having published personal identifiable information, including home addresses, of the State Court Plaintiffs.”

Ultimately, Judge Mora concluded that the entire exercise was a bad faith attempt by a solvent company to evade reckoning in state court.

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“This Court’s only task in this case is to determine whether the debtor, a business entity wholly owned and run by one person, has demonstrated a valid reorganizational purpose for chapter 11 bankruptcy motivated by good faith intent,” she concluded. “The answer, in short, is no, it has not.”

TL, DR: Nice try, asshole. Have fun in state court. And maybe think about paying your taxes in the state of Florida.

TGP Communications LLC [Docket via Court Listener]

Liz Dye lives in Baltimore where she produces the Law and Chaos substack and podcast.

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