The company that publishes Gawker filed for Chapter 11 bankruptcy in the Southern District of New York on Friday. Gawker Media’s seven brands and assets will be sold to global digital media company Ziff Davis.
In a statement released Friday afternoon, Gawker announced that the sale came in response to “a coordinated barrage of lawsuits intended to put the company out of business.”
The company said it would “maintain normal operations” during the sale process and continue to regularly publish stories.
Gawker Media’s statement: pic.twitter.com/Ntf37UnUlP
— Ben Mullin (@BenMullin) June 10, 2016
The largest creditor listed in the bankruptcy filing is Terry Bollea, otherwise known as wrestler Hulk Hogan, whose claim is listed as $130 million.
Gawker Media LLC was financially devastated after losing a $140 million invasion-of-privacy suit to Hogan in May over a sex tape the site published. Hogan since launched another suit, charging that Gawker leaked sealed court documents in which he is quoted making racist remarks.
In late May, major Silicon Valley investor Peter Thiel confirmed rumors that he had funded both suits against the site for “bullying” him and outing him as gay in a 2007 post.
Gawker founder Nick Denton accused Thiel of launching a “vindictive” campaign against the company and behaving like a “comic book villain.”
Though the company said it expected to win the Hogan sex tape case on appeal, lawyers said during the trial that the company was worth $83 million, less than what Hogan was owed.
Gawker had hired an investment banker from Houlihan Lokey to help explore its options for continuing operations, including a possible sale.
The initial bankruptcy filing:
Donald Trump approves of this bankruptcy.
Umm. Yeah. I got nothin’.
It does hinder those searching for Hulk Hogan penis trivia.
Trump: Media must always oblige the powerful or face devastating consequences. We always win.
The lesson here is that it was a pretty inexpensive and effective way for Peter Thiel to get revenge on and silence his media critics. Expect more like this in the future from similar thin-skinned billionaires (and multi-millionaires). Gawker may be more-or-less expendable, but our cherished freedom of the press is subject to attack - Peter Thiel provided the playbook.