The four-year legal battle between former professional wrestler Hulk Hogan and Gawker Media came to a quiet end Tuesday, as a bankruptcy judge in New York confirmed a liquidation plan for the media company that settles Hogan's $140 million judgment for $31 million.
Hogan, whose real name is Terry Bollea, successfully sued Gawker Media for invasion of privacy in a Florida state court after the media company's namesake site published -- and refused to take down -- a sex tape of him and Heather Clem, the wife of a talk radio host.
Gawker Media filed for bankruptcy on June 10 after Hogan won the massive judgment. It was later revealed that Hogan's legal campaign against the debtor had been surreptitiously financed by Peter Thiel, a Silicon Valley billionaire whom the website outed as gay in 2007.
After initially vowing to fight the litigation, Gawker Media settled with Hogan in November, citing concerns over the cost of continuing a legal war against Thiel.
The settlement also resolved litigation with two other clients of Hogan's lawyer, Charles Harder of Harder Mirell & Abrams.
The judgment in favor of Hogan held Gawker Media founder Nick Denton and former Gawker.com editor-in-chief A.J. Daulerio jointly liable with Gawker Media for Hogan's $115 million compensatory damage claim and individually liable for punitive claims. The settlement as originally constructed did not resolve the $150,000 punitive claim against Daulerio, which left the door open for a possible appeal.
That door slammed shut Tuesday, as Gawker Media announced that Daulerio, like Denton, had signed onto a cooperation agreement that ends Hogan's pursuit of the punitive judgment.
"There will be no further litigation with respect to the underlying [Hogan] judgment," Gawker Media counsel Gregg M. Galardi of Ropes & Gray said.
Having resolved the matter with Hogan, Gawker Media moved before Tuesday's hearing to wrap up litigation with the flood of alleged creditors that had filed defamation and invasion of privacy suits against the controversial company.
Former pro baseball pitcher Mitch "Wild Thing" Williams -- whose defamation suit had already been tossed out of a New Jersey state court -- will receive $125,000. Gawker Media's sports blog, Deadspin, had published a story reporting on allegations that Williams verbally abused a youth baseball umpire and directed a 10-year-old child he coached to intentionally hit an opponent with a pitch.
Meanith Huon, a Chicago lawyer, will receive $100,000. He sued Gawker Media for defamation over comments about him in an article that reported on a suit he filed against law blog Above the Law. Huon had sued Above the Law over its coverage of a sexual assault allegation levied against him; he was acquitted of the charge.
"If you make a motion to dismiss and lose another one of these cases, you could end up with another Bollea situation," Judge Stuart M. Bernstein said from the bench.
Gawker Media's liquidation plan will pay all of its unsubordinated, unsecured creditors in full using the remaining proceeds from a $135 million sale of the majority of its blog network to Univision Communications after an August bankruptcy auction. It also includes releases that protect its writers from future litigation.
Gawker.com itself shut down after Univision declined to purchase the site. Its writers were assigned to other blogs formerly owned by Gawker Media.
A small group of former Gawker Media employees attended Tuesday's hearing clad in matching shirts that bore the names of the company's blogs. They audibly exhaled after Bernstein approved the liquidation plan and releases.
A consortium of 21 media organizations -- including the Society of Professional Journalists and Vox Media -- had filed an amicus curiae brief with the court before the confirmation hearing, urging Bernstein to approve the releases on first amendment grounds.
"Gawker was proud to flout traditional journalistic standards, so it was nice that those institutions were still willing to back us in this matter," former Gawker.com writer Jordan Sargent said. "Despite the fact that we sometimes wanted to chip away at what they did."