The U.S. Justice Department's bankruptcy watchdog said on Monday that a law firm and chief restructuring officer hired by Infowars' parent company failed to disclose they were working for the business at the same time they represented other Infowars affiliates during an earlier chapter 11 case, MarketWatch.com reported. U.S. Trustee Kevin Epstein said in court filings that the law firm Shannon & Lee LLP and proposed CRO W. Marc Schwartz failed to disclose the dual representations in retention applications in the first bankruptcy which involved corporate affiliates holding Infowars intellectual property. During the first bankruptcy, both professionals also represented Infowars parent Free Speech Systems LLC which was not in chapter 11 at-the-time, the U.S. Trustee said. The earlier Infowars bankruptcy was dismissed and FSS subsequently filed chapter 11 in July. Epstein said the judge overseeing FSS' chapter 11 case should deny Shannon & Lee and Mr. Schwartz's requests to be retained in the current bankruptcy case because they failed to comply with chapter 11 disclosure rules meant to weed-out potential conflicts of interest when they didn't disclose their connection to FSS in the first Infowars bankruptcy. Epstein said that the judge should deny the retention applications "to protect the integrity of the bankruptcy system."
