Gawker Media has asked a US court permission to borrow $22 million from an affiliate of Cerberus Capital to help with its bankruptcy sale, according to a report by Reuters. The online media company had filed for bankruptcy last week after a Florida judge upheld a $140 million judgement against it in a legal battle with former professional wrestler Hulk Hogan.
Gawker’s troubles began after it published excerpts from a sex tape involving Hogan who sued the company. Billionaire Peter Thiel, who founded PayPal, bankrolled Hulk Hogan’s lawsuit. Thiel and Gawker have been at odds after it published a story which outed him as gay.
Internet media company Ziff Davis has agreed to buy Gawker for $90 million and the auction is expected to conclude by the end of July. Cerberus Capital is private equity firm in the United States which specializes in investing undervalued and distressed assets.
Earlier in the day, Sam Biddle, a long time writer at Gawker, announced that he would be joining Pierre Omidyar-backed the Intercept. Biddle headed Gawker’s blog on Silicon Valley gossip Valleywag from April 2013 to November 2015 when Valleywag was decommsioned. Readers were directed to Gizmodo, another technology blog started by Gawker for more stories on technology.
After 6 of the best years of my whole life at Gawker I’m heading to @theintercept in July to cover technology and power in Silicon Valley
— Sam Biddle (@samfbiddle) June 13, 2016
What will happen to its partnership with Times Internet?
Note that Times Internet signed a partnership with Gawker Media in 2013 to offer Indian editions of Gizmodo and Lifehacker (a blog focused on productivity and technology). MediaNama reached out to Times Internet to comment on how Gawker’s bankruptcy and sale would affect their partnership, to which they replied with a boiler plate response saying they “continue to see great opportunities for the two brands.” Times Internet’s response:
‘Gizmodo, Lifehacker and TIL have continued to grow well in India and have grown nearly six times since we announced our partnership. We continue to see great opportunities for the brands going forward’ – Puneet Singhvi, COO of Times Global Partners.
Criminal defamation in India
The legal battles of Gawker has triggered a debate on defamtion and how it affects media companies. In India, defamation is a criminal offence in India under the colonial era Indian Penal code which also prescribes jail term. In May, the Supreme Court of India upheld validity of criminal defamation.
Note that media houses (including ours) often receive legal notices with threats of criminal defamation. This often leads to a chilling effect where publication would practice a form of self censorship to be on the safer side of law. For example, journalist Amit Bhawani, who runs tech sites like PhoneRadar.com, AndroidAdvices.com, received an elaborate legal notice from Flipkart for using their logo in a poll that Bhawani was running on a URL named AmazonVsFlipkart.com. Bhawani took down the website after receiving the notice.
More about criminal defamation, Star India’s legal notice to us and other cases here.