News

He's not transferring his assets or the assets of his company. He's just urging people who would have bought products from him to buy products from his dad. I think that that's legal.

I don't think that "diverting assets", which the article used, is the right term here.

EDIT: Maybe bankruptcy law has some sort of restrictions on "goodwill", but I'm skeptical.

kagis

Hmm. It might be a complicated question.

https://www.kridel.com/blog/2020/06/appraising-goodwill-during-bankruptcy-proceedings

Businesses can have a variety of valuable assets, including securities, real estate, costly equipment, and expensive office space. However, some of a company's most valuable equity is in intangible assets, such as customer goodwill, client lists, and name recognition. Although these assets are often intangible, they can and should be appraised and valued during bankruptcy proceedings.

When calculating the value of goodwill, a valuation expert will attempt to separate professional goodwill, which attaches to a particular individual, and business goodwill, which is derived from the characteristics of a particular business. To allocate value, analysts will consider a variety of objective factors, including:

• What a qualified buyer would pay for the business if the owner were allowed to compete in the same industry in the same area;
• Amounts paid for non-compete or consulting agreements; and,
• The market price of the company's publicly traded stock.

Whether goodwill is defined as personal or business can have significant repercussions on the outcome of a bankruptcy case, so if you or a loved one own a business and are considering filing for bankruptcy, it is crucial to speak with an experienced bankruptcy attorney before filing your petition.

Hmm.

So, I'm gonna make a guess from that that the way this works is that he might be restricted from, as the CEO of the company, saying "customers, this other company is the place to go", where his statement relies on business goodwill. But if he's asking people to support him personally and saying then that'd be professional goodwill and not a business asset.

kagis more

Oh, but the lawsuit he lost was against him personally, not his company, so he's personally liable for the lawsuit.

Hmm.

That's an interesting question. I don't know. Like, if he endorses his father's company over his own, does that represent loss of his professional goodwill, and do they have some sort of claim on that? Like, is Alex Jones the individual restricted from making his personal associations less valuable?

EDIT2: I thought that bankruptcy law was federal, but this references state law, so the state may be a factor here. But it does look like it's been an active topic of discussion not far back. This is twenty years back, so there may have been newer developments, but it sounds like it was kind of an open question at that time; this article is arguing that professional goodwill is subject to seizure in bankruptcy, so I assume that intentionally decreasing its value might get someone in trouble.

https://www.nyulawreview.org/wp-content/uploads/2018/08/NYULawReview-77-5-Jacoby-Zimmerman.pdf

FORECLOSING ON FAME: EXPLORING THE UNCHARTED BOUNDARIES OF THE RIGHT OF PUBLICITY

Since the 1950s in the United States, fame increasingly has been treated as a commodity rather than a purely personal attribute. States, encouraged largely by entertainers, sports figures, and their families, have created a new form of intellectual property interest called the right of publicity, a right to exploit one's identity for commercial purposes. This right permits famous people-and increasingly their heirs and legatees-to control how, and demand payment when, their names and faces are used by others. Moreover, the right is freely alienable, meaning that it can be transferred to third parties in whole or in part. Most of the scholarship examining this form of intellectual property has concentrated on the justifications for giving famous people this kind of control over, and right to profit from, the commercial use of their identities, or on the First Amendment ramifications of the interest. In other words, the scholarship has focused on the pros and cons of creating a property interest that advantages a celebrity, her heirs, and assigns. But the legal assignment of property status to an interest can, under some circumstances, decrease, rather than increase, the control that the "owner" has over the valued asset. That darker side of the equation has received almost no attention either in the literature or in the case law dealing with publicity. In this Article, we examine the right of publicity as an asset in the context of the debtor-creditor system. Whereas personal rights in one's privacy or reputation are generally unavailable for creditor seizure and sale, the transformation of the persona into a commodity logically should make it vulnerable to seizure by an unsatisfied creditor,permitting control over how the right is exploited to be transferred by sale to the highest bidder. The right of publicity presents some complexities in the debtor-creditor context because the property interest in some cases may need to be disentangled from its residual overlay of personal rights, and because the use of property to satisfy a creditor's claims must be handled in a way that respects the debtor's right to the benefits of her future labor. Our examination of the issues leads us to conclude that the complexities presented by treating publicity rights as property in the debtor-creditor context are resolvable and indeed are similar to those presented by other types of property that are currently recognized as such in the debtor-creditor system and used to satisfy unpaid debts; the complexities do not militate against treating the right of publicity as an asset in the debtor-creditor system.