Gawker Media, Hulk Hogan Step Out of Ring

Gawker Media has rolled away from a body slam by former professional wrestler Terry Bollea, better known as Hulk Hogan.

According to an updated version of the debtor's disclosure statement -- the document outlining what creditors of its estate will receive in its liquidation -- filed on Wednesday, Bollea would receive $31 million in cash under the terms of a settlement. Bollea had won a $140 million judgment against the media company in a Florida state court in March in an invasion of privacy lawsuit. Gawker.com in 2012 had published a portion of a sex tape of him having sex with the wife of a friend, Todd Clem, the radio shock jockey better known as Bubba "the Love Sponge" Clem.

The settlement would put an end to any potential legal drama between Gawker, which once had vowed to pursue a reversal of the judgment, and Bollea. Gawker in court papers attributed its Chapter 11 filing on June 10 to the litigation and not the company's ongoing performance.

The ex-wrestler's legal pursuit against Gawker was secretly financed by billionaire entrepreneur Peter Thiel, the co-founder of PayPal Holdings (PYPL) and Palantir Technologies.

"Even were the Bollea judgment to be reversed, litigating that appeal to judgment would substantially delay any distributions to Gawker Media general unsecured creditors," the debtor said in its disclosure statement. In contrast, the settlement should allow payment in full of general unsecured creditors, excluding postpetition interest, by year's end.

Gawker is set to seek approval of the disclosure statement on Thursday morning in the U.S. Bankruptcy Court for the Southern District of New York. Approval would allow the debtor to send its liquidation plan to creditors for voting.

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