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| Gawker Media files for bankruptcy in wake of costly Hulk Hogan lawsuit | Gawker Media files for bankruptcy in wake of costly Hulk Hogan lawsuit |
| (2 months later) | |
| Gawker Media, the media website that thrived off scandal and controversy, filed for bankruptcy on Friday after losing a $140m lawsuit surrounding one of its most controversial stories: the publication of a sex tape involving former wrestler Hulk Hogan. | Gawker Media, the media website that thrived off scandal and controversy, filed for bankruptcy on Friday after losing a $140m lawsuit surrounding one of its most controversial stories: the publication of a sex tape involving former wrestler Hulk Hogan. |
| The website, founded by British journalist Nick Denton in 2002, filed for Chapter 11 bankruptcy on Friday listing Hogan – whose real name is Terry Bollea – as its biggest creditor. | The website, founded by British journalist Nick Denton in 2002, filed for Chapter 11 bankruptcy on Friday listing Hogan – whose real name is Terry Bollea – as its biggest creditor. |
| The move came after a judge refused to allow Gawker more time to appeal, meaning it must put up a $50m bond toward Hogan’s damages. | The move came after a judge refused to allow Gawker more time to appeal, meaning it must put up a $50m bond toward Hogan’s damages. |
| In March, a Florida jury awarded $115m in damages to Hogan, more than the $100m he had demanded for the violation of his privacy over the publication of a sex tape involving him and the wife of a good friend. A jury later awarded him $25m more in punitive damages. | In March, a Florida jury awarded $115m in damages to Hogan, more than the $100m he had demanded for the violation of his privacy over the publication of a sex tape involving him and the wife of a good friend. A jury later awarded him $25m more in punitive damages. |
| It was revealed last month that billionaire tech entrepreneur Peter Thiel had been funding Hogan’s legal costs as part of his latest attempt to close down the website, which outed him as being gay in 2007 with the headline: “Peter Thiel is totally gay, people.” | It was revealed last month that billionaire tech entrepreneur Peter Thiel had been funding Hogan’s legal costs as part of his latest attempt to close down the website, which outed him as being gay in 2007 with the headline: “Peter Thiel is totally gay, people.” |
| Thiel, a co-founder of PayPal and a early investor in Facebook, said he had secretly funded a team of lawyers to track down “victims” of Gawker and help fund their lawsuits against the company. Thiel said he had funded Hogan’s legal costs to the tune of about $10m. | Thiel, a co-founder of PayPal and a early investor in Facebook, said he had secretly funded a team of lawyers to track down “victims” of Gawker and help fund their lawsuits against the company. Thiel said he had funded Hogan’s legal costs to the tune of about $10m. |
| “It’s less about revenge and more about specific deterrence,” Thiel told the New York Times. “I saw Gawker pioneer a unique and incredibly damaging way of getting attention by bullying people even when there was no connection with the public interest … I thought it was worth fighting back.” | “It’s less about revenge and more about specific deterrence,” Thiel told the New York Times. “I saw Gawker pioneer a unique and incredibly damaging way of getting attention by bullying people even when there was no connection with the public interest … I thought it was worth fighting back.” |
| Thiel said funding the lawsuit was one of the “greater philanthropic things that I’ve done”, and said he would further lawsuits brought people who said their lives had ben ruined by Gawker. | Thiel said funding the lawsuit was one of the “greater philanthropic things that I’ve done”, and said he would further lawsuits brought people who said their lives had ben ruined by Gawker. |
| Denton, who is also gay, said he would continue to fight back and would not allow Thiel to silence Gawker’s writers. “Even with his billions, Thiel will not silence our writers,” he said on Twitter. “Our sites will thrive – under new ownership – and we’ll win in court.” | Denton, who is also gay, said he would continue to fight back and would not allow Thiel to silence Gawker’s writers. “Even with his billions, Thiel will not silence our writers,” he said on Twitter. “Our sites will thrive – under new ownership – and we’ll win in court.” |
| Even with his billions, Thiel will not silence our writers. Our sites will thrive — under new ownership — and we'll win in court. | Even with his billions, Thiel will not silence our writers. Our sites will thrive — under new ownership — and we'll win in court. |
| Gawker, which also owns Jezebel and Gizmodo, will be put up for auction with bidding starting at about $100m following interest from digital publisher Ziff Davis LLC. Ziff Davis owns a number of tech and gaming publications, including PC Magazine and IGN. | Gawker, which also owns Jezebel and Gizmodo, will be put up for auction with bidding starting at about $100m following interest from digital publisher Ziff Davis LLC. Ziff Davis owns a number of tech and gaming publications, including PC Magazine and IGN. |
| “We are encouraged by the agreement with Ziff Davis, one of the most rigorously managed and profitable companies in digital media,” Denton said. “A combination would marry Ziff Davis’ strength in e-commerce, licensing and video with GMG’s premium media brands,.” | “We are encouraged by the agreement with Ziff Davis, one of the most rigorously managed and profitable companies in digital media,” Denton said. “A combination would marry Ziff Davis’ strength in e-commerce, licensing and video with GMG’s premium media brands,.” |
| Chapter 11 bankruptcy allows a company to “reorganize” its business, according to the Securities and Exchange Commission, meaning that the company continues to operate and pay staff but all “significant decisions must be approved by a bankruptcy court”. Entering bankruptcy freezes claims from creditors – including Hogan. | Chapter 11 bankruptcy allows a company to “reorganize” its business, according to the Securities and Exchange Commission, meaning that the company continues to operate and pay staff but all “significant decisions must be approved by a bankruptcy court”. Entering bankruptcy freezes claims from creditors – including Hogan. |
| Gawker petition grab pic.twitter.com/I1SrCqcguA | Gawker petition grab pic.twitter.com/I1SrCqcguA |
| In the filing, Gawker said its assets are estimated to be worth $50m to $100m, whereas its liabilities are estimated to be between $100m and $500m. | In the filing, Gawker said its assets are estimated to be worth $50m to $100m, whereas its liabilities are estimated to be between $100m and $500m. |
| In a statement Hogan’s legal counsel said: “We have every intention to continue to pursue our judgement against Gawker and to hold them accountable for violating Mr Bollea’s privacy whether it be in the bankruptcy court or any other court.” | In a statement Hogan’s legal counsel said: “We have every intention to continue to pursue our judgement against Gawker and to hold them accountable for violating Mr Bollea’s privacy whether it be in the bankruptcy court or any other court.” |
| Denton still owns the majority of the company, which was once valued at as much as $400m, but sold a minority stake to tech investment firm Columbus Nova Technology Partners to bolster its finances it ahead of the Hogan lawsuit. Gawker made $6.5m in profits on sales of $45m in 2014, the latest year available. | Denton still owns the majority of the company, which was once valued at as much as $400m, but sold a minority stake to tech investment firm Columbus Nova Technology Partners to bolster its finances it ahead of the Hogan lawsuit. Gawker made $6.5m in profits on sales of $45m in 2014, the latest year available. |
| Gawker had not published a story about its demise, and it was not clear what the immediate effect would be on its staff. | Gawker had not published a story about its demise, and it was not clear what the immediate effect would be on its staff. |
| See @HulkHogan listed as largest unsecured claim in Gawker bk pic.twitter.com/PsDAjBQYMW | See @HulkHogan listed as largest unsecured claim in Gawker bk pic.twitter.com/PsDAjBQYMW |
| Gawker started life in Denton’s Soho apartment in Manhattan with a mission to expose celebrities and the media elite. It quickly became popular for its “snarky” tone and abhorrence of PR and media spin. | Gawker started life in Denton’s Soho apartment in Manhattan with a mission to expose celebrities and the media elite. It quickly became popular for its “snarky” tone and abhorrence of PR and media spin. |
| The company employs about 300 people, and has grown from covering gossip to breaking big news stories including significant developments in the saga surrounding Hillary Clinton’s emails and former Toronto mayor Rob Ford smoking crack cocaine. | The company employs about 300 people, and has grown from covering gossip to breaking big news stories including significant developments in the saga surrounding Hillary Clinton’s emails and former Toronto mayor Rob Ford smoking crack cocaine. |