Gawker Media on Friday filed for bankruptcy, seeking to sidestep a shutdown from a $140 million judgment for releasing a Hulk Hogan sex tape in a lawsuit bankrolled by a Silicon Valley billionaire.
Following the bankruptcy filing, the embattled US media group said it had reached a deal to sell its media brands to publishing group Ziff Davis.
The moves come with Gawker under fire for its no-holds-barred approach to celebrity coverage, but with questions also raised about whether powerful interests can use their resources to silence media for unfavourable coverage.
The filing in New York follows the whopping jury award earlier this year for releasing a tape of pro wrestler Hogan having sex with a friend’s wife.
The case drew heightened attention when Silicon Valley titan Peter Thiel acknowledged that he had helped fund the litigation and others against Gawker, with whom he has feuded for years since it “outed” him as a homosexual.
The filing in federal bankruptcy court in New York lists assets in a range of $50 million to $100 million, and liabilities between $100 million and $500 million.
It seeks protection of its assets under Chapter 11 of the US bankruptcy code.
The Gawker statement offered no financial details but said the media assets would be sold “free and clear of legal liabilities and maximize value for all stakeholders.”
It said the sale will be conducted through a bankruptcy court supervised auction, in which other bidders may also participate.
Ziff-Davis known for its PC Magazine among others, is part of the j2 Global digital media group. The deal calls for acquisition of the website Gawker as well as other brands including Gizmodo, Deadspin and Lifehacker.
Gawker founder Nick Denton appeared to dig in his heels in the feud with Thiel. “Even with his billions, Thiel will not silence our writers,” Denton said in a tweet.
“Our sites will thrive -- under new ownership -- and we’ll win in court.”