Gawker Media founder faces personal bankruptcy
By Jessica DiNapoli
NEW YORK (Reuters) - Gawker Media LLC founder Nick Denton faces personal bankruptcy after a U.S. judge refused on Tuesday to extend protections shielding him from liabilities resulting from a lawsuit over the invasion of privacy of former professional wrestler Hulk Hogan.
The decision represents a victory for Hogan as well billionaire investor Peter Thiel, an early backer and board member of Facebook Inc (FB.O: Quote) who helped fund Hogan's lawsuit following the publication of an article by Gawker about Thiel's homosexuality.
"This story will conclude with Gawker Media's popular brands sheltered under new ownership and the importance of a free and critical press reaffirmed by the courts. In the end, the Facebook board member will have nothing to show for his petty grudge other than legal expenses and a reputation for thin skin," Denton said in a statement.
Thiel did not immediately respond to a request for comment.
Gawker, a U.S. internet publisher, filed for Chapter 11 bankruptcy protection in June after Hogan won a $140 million judgment against the company over the publication of excerpts from a sex tape, $125 million of which Denton is liable for, according to court filings.
Attorneys for Gawker had asked the court for the same protections for its founder, including a shield from lawsuits. The court had only agreed to give Denton temporary protections.
Stuart Bernstein, U.S. bankruptcy court judge for the Southern District of New York, declined on Tuesday to extend the shield.
Attorneys for Gawker argued that without the shield, Denton would be distracted by his own personal bankruptcy process. Gawker's business and its plan to sell itself in bankruptcy would suffer, they said. Continued...