For the past three years, pro-wrestler Hulk Hogan —real name Terry Bollea—has been involved in a civil suit against Gawker Media. In 2007, Hogan was taped having sex with the wife of radio “shock jock” Bubba the Love Sponge. The video was made and distributed without Hogan’s knowledge. In 2012, Gawker published excerpts from the video, garnering 2.5 million views for the site. Hogan sued Gawker Media, its founder Nick Denton, and former editor-in-chief A.J. Daulerio for invasion of privacy. Gawker defended itself by claiming the video had “news value” because it depicted a public figure, and was protected by the First Amendment.
A civil court jury sided with Hogan, and has ordered Gawker Media, Denton, and Daulerio to pay more than $140 million in compensatory and punitive damages. Whether the judgment holds up on appeal or gets severely reduced is an open question, but there have already been effects. The blog had to place $50 million in escrow just to stay enforcement of the judgment, which has led to a portion of the company being sold off to a Russian oligarch. And the website has undergone a transition from gossip to political coverage, after getting itself in the fire one too many times.
In many ways, this can be seen as the logical conclusion of Gakwer’s gossip coverage, which has many times danced on the line of common decency. Last July, the site’s editorial staff resigned in protest after Denton pulled a story which went after David Geithner—the younger brother of former treasury secretary Tim Geithner, and the chief financial officer of Condé Nast Publications—for allegedly trying to hire a male porn actor for sex who then attempted to blackmail Geithner for money. The story was extremely controversial, since it not only may have outed a married man, but it also seemed to help Geithner’s blackmailer achieve the ends he threatened.
News reports indicate this sort of thing might be behind Gawker’s current predicament. According to journalists at Forbes, billionaire Peter Thiel has been secretly underwriting Hogan’s lawsuit for years. Thiel is one of the founders of PayPal and was an early investor in Facebook, who over the years has been a target of Gawker for his financial investments, support of right-wing political efforts including Donald Trump’s candidacy. The site also outed him as gay. Thiel has referred to Gawker Media as a high-tech form of al-Qaeda.
So is this the story of a blog that has no respect for personal privacy, and is now paying the price for it? Or is it an instance where someone’s wealth and power is destroying a publication it can’t stand—in a way that’s a clear threat to freedom of the press?
Gawker has been hit with new lawsuits in recent weeks. All of the cases share the same attorney filing claims —Charles J. Harder, a Los Angeles litigator who’s also Hogan’s lead attorney. Earlier this week, Denton was quoted in The New York Times speculating about an outside source funding both Hogan and the other new cases against Gawker. And there have been others who’ve thought the same thing, because of the costs involved in a lawsuit of this type and the fact that neither Hogan or his representatives ever seemed to attempt to settle the case. On Monday, Denton said he believed it might be someone connected to Silicon Valley. That someone has been revealed as Thiel.
Thiel has in the past bristled at Gawker’s Valleywag site, which covered Silicon Valley on a semi-regular basis between 2006 to 2015. He referred to Valleywag as having “the psychology of a terrorist.” Thiel was outed as gay by Gawker in 2007.
From Ryan Mac and Matt Drange at Forbes:
It is not illegal for an outside entity to help fund another party’s lawsuit, and the practice, known as “third-party litigation funding” has become increasingly common in the U.S. Typically, the outside party negotiates for a defined share of any proceeds from the suit.
A partner with Harder Mirell & Abrams LLP, [Charles J.] Harder is a well-known Hollywood lawyer whose past clients includedGeorge Clooney, Julia Roberts and a slew of other celebrities. He is also representing plaintiffs against Gawker in other lawsuits, including a defamation case on behalf of Shiva Ayydurai in Boston that was filed earlier this month. Ayydurai, who claims to have invented email, was the subject of a story by Gawker journalist Sam Biddle, who wrote that the plaintiff was a “fraud” according to former colleagues. Ayydurai’s lawsuit seeks“ no less than $35 million in damages.”
Harder has represented writer Ashley Terrill since January and filed an amended complaint in her lawsuit against Gawker and Biddle in April. She alleges that the site published “a false and highly defamatory hit-piece” about her written by Biddle last year after she had initiated a working relationship with Gawker to publish a story. Earlier this month Gawker’s lawyers argued that Terrill’s case should be dismissed. On May 18, the judge in the case gave Terrill’s legal team two weeks to file a second amended complaint before the case moved forward. As of Tuesday, no additional documents have been filed in the case.”
It is unclear if Thiel is helping to fund Ayydurai or Terrill’s cases against Gawker.
According to other reports, the details of Thiel’s support for Hogan’s case are protected by a confidentiality agreement.
There hasn’t been that much sympathy for Gawker, since claiming the First Amendment to publish sex tapes and out people as gay isn’t the most noble thing in the world. However, there are some concerns this strategy is a “huge deal,” since it can be used by any wealthy individual who doesn’t like the coverage to bleed publications and blogs dry.
From Josh Marshall at Talking Points Memo:
We don't have to go any further than Donald Trump to know that the incredibly rich often use frivolous litigation to intimidate critics and bludgeon enemies. Mother Jones had a lawsuit like this, clearly intended to bleed them dry through endless legal expenses. They won, though at a steep cost. But when bully plutocrats do so in their own name there is at least a self-correcting dynamic at work. A plaintiff in a libel suit opens him or herself up to reputational harm and highly intrusive legal discovery which is often enough to scare people away. (Remember, when Trump sued Tim O'Brien for publishing Trump insiders' claims that Trump was worth less than $250 million dollars, Trump was eventually forced to show O'Brien's lawyers his tax returns.) In some ways, this lines up with something I noted in my 'Brittle Grip' series of posts: growing calls from the extremely rich to not only be able to use their money without limit to shape the political process but to do so anonymously to avoid being "intimidated" or "vilified".
It all comes down to a simple point. You may not like Gawker. They've published stories I would have been ashamed to publish. But if the extremely wealthy, under a veil secrecy, can destroy publications they want to silence, that's a far bigger threat to freedom of the press than most of the things we commonly worry about on that front. If this is the new weapon in the arsenal of the super rich, few publications will have the resources or the death wish to scrutinize them closely.