Over and Out
Hulk Hogan’s $31 Million Gawker Payday
Bringing an end to the legal beef that killed Gawker, Hulk Hogan is set for another multimillion-dollar payout—and three Gawker articles will disappear from the internet.
Former pro wrestler Terry Gene Bollea, better known as reality television star and celebrity endorser Hulk Hogan, will receive $31.25 million to settle his invasion of privacy lawsuit against Gawker Media, the defunct company’s founder Nick Denton and former Gawker.com editor in chief A.J. Daulerio.
Two other plaintiffs who filed lawsuits against Denton’s gossipy news site—freelance journalist Ashley Terrill and computer scientist Shiva Ayyadurai—will share $1.25 million under a settlement agreement that Denton announced Wednesday on his personal website, ending his legal crucible.
“After four years of litigation funded by a billionaire with a grudge going back even further, a settlement has been reached. The saga is over,” Denton wrote, referring to Silicon Valley venture capitalist Peter Thiel, who has acknowledged secretly bankrolling the three lawsuits against Gawker Media, to the tune of $10 million, in order to punish Denton and his company for revealing in 2007 on Gawker’s Valleywag site that Thiel is gay and other details of his life and business that the German-born tech entrepreneur considered unfit for public consumption.
In return for the combined $32.5 million in cash payments, which include $500,000 for Terrill and $750,000 for Ayyadurai, and removing the offending stories from the internet, the plaintiffs agreed to drop their lawsuits and not to refile them; aside from Denton and Daulerio, John Cook, Gawker Media’s former executive editor, and Sam Biddle, a former writer for Gawker.com, are also no longer defendants.
Terrill, who claimed Gawker “published a false and highly defamatory hit-piece” about her by Biddle, had demanded “no less than $10 million” in her lawsuit. Ayyadurai, the husband of the actress Fran Drescher, had demanded $35 million for Biddle’s story debunking his claim to have invented email.
“Hulk Hogan’s retirement will be comfortable,” predicted Denton, who was forced by the multiplying litigation into personal and corporate bankruptcy. A source close to Denton said the deal did not require him to sign a non-disparagement agreement.
“As the most unpalatable part of the deal, three true stories — about Hulk Hogan, the claim by Shiva Ayyadurai that he invented email and the feud between the founders of Tinder [in which Terrill played a major role]— are being removed from the web,” Denton added.
Bollea’s personal attorney, David Houston, said in an uncharacteristically muted statement: “As with any negotiation for resolution, all parties have agreed it is time to move on.”
Daulerio, who is no longer liable for a $100,000 judgment against him in the Hulk Hogan case, didn’t respond to an email seeking comment. But Cook and Biddle, who did not participate in the negotiations, bitterly blasted the settlement.
“I feel physically ill,” said Biddle, who now works as a reporter for the investigative web site The Intercept. “I stand by my work.”
Cook, meanwhile, told The Daily Beast: “Livid is my feeling about the fact the pieces in question have been taken down…I have not paid anybody a penny, nor will I. I have not agreed to say anything or do anything. I have not agreed to limit any statement I may make. I have not signed anything.”
Cook added, however, that he doesn’t blame Denton, who was forced to move out of his pricey Soho loft and rent less expensive digs with his husband, actor Derrence Washington, as part of the bankruptcy proceedings.
“This was in some ways out of his hands,” Cook said. “An independent director exercises tremendous influence over the affairs of the estate, and he is charged with maximizing value, not defending principles. Whether to go along with it was an impossible decision for Nick.”
Denton declined to comment beyond his written statement.
The payments to Hogan, Terrill and Ayyadurai will come out of the $135 million that Latino-oriented multimedia powerhouse Univision spent to acquire six of Denton’s web sites, but not Gawker, in an Aug. 16 sale supervised by a federal bankruptcy court. Univision has rebranded the properties the Gizmodo Media Group, and John Cook remains as executive editor.
Under the terms of the sale, Gawker.com must not compete with Univision’s Gizmodo Media for 18 months—after which Denton and other stakeholders can put it on the block. It is unclear if Denton--whose net worth was once estimated at upwards of $100 million--will receive a substantial reward from the Univision sale after payments to creditors and other stakeholders, including an army of lawyers, are satisfied. But the settlement seems designed to assure his exit from bankruptcy.
According to the settlement, in the event that Gawker is sold, Bollea and the other two plaintiffs will share 45 percent of the proceeds.
In the end, the Thiel-funded litigation, quarterbacked by Los Angeles lawyer Charles Harder, whose clients include Kim Kardashian West and Melania Trump, resulted in an astonishing $140.1 million jury award to Bollea in March after a two-week trial in St. Petersburg, Fla. The award—which Denton was in the process of appealing—drove him and his company into financial ruin.
Bollea’s lawsuit was prompted by Gawker’s October 2012 publication of portions of a sex video, and an accompanying story by Daulerio, in which Bollea was shown bedding the wife of his then-best friend, a Florida radio shock jock who went by the nickname Bubba the Love Sponge.
“Yes, we were confident the appeals court would reduce or eliminate the runaway Florida judgment against Gawker, the writer of the Hogan story and myself personally,” Denton wrote. “And we expected to prevail in those other two lawsuits by clients of Charles Harder, the lawyer backed by Peter Thiel.
“But all-out legal war with Thiel would have cost too much, and hurt too many people, and there was no end in sight. The Valley billionaire, famously relentless, had committed publicly to support Hulk Hogan beyond the appeal and ‘until his final victory.’ Gawker’s nemesis was not going away.”
As the settlement negotiations were reaching agreement, Thiel took what amounted to a pre-victory lap on Monday by appearing for a Q&A at the National Press Club in Washington.
The Intercept—whose owner, eBay billionaire Pierre Omidyar, tried to organize an amicus support of Gawker in the Hulk Hogan lawsuit—reported that Thiel, a Donald Trump delegate and speaker at the Republican Convention, was accorded kid-glove treatment during the lunchtime session.
“[W]elcoming Thiel to what he called the “lion’s den,” Press Club President Thomas Burr did not take an adversarial position, instead asking Thiel softball questions and leaving numerous inaccurate statements uncorrected,” The Intercept’s Naomi LaChance wrote. “Reporters had no opportunity to independently ask Thiel questions; instead, Burr chose them from index cards submitted online.”
LaChance continued: “Thiel called Gawker a ‘singularly sociopathic bully,” and added, ‘these were not journalists.’ Burr offered no rebuttal. He could have mentioned, for example, that Gawker was the first site to report Hillary Clinton’s use of emails from a nongovernment account, as Gizmodo Media Group Executive Editor John Cook noted Monday.”
Unchallenged, Thiel went on, “One class of people [Gawker] especially hated were other reporters, other writers. And in the sort of prehistory as we were building up this case there were a few people I talked to about it, and some of the people who encouraged me to keep going were some of my friends in the media, because they knew how much Gawker had actually specifically targeted more successful writers and reporters over the years.”