After a long court fight, several lawyers, and taking a leg drop in the ring to one of professional wrestling’s greatest legends, Gawker has filed for chapter 11 bankruptcy and put itself up for sale officially. Gawker will put an auction up for ownership of the company which was information given under the condition of anonymity as the auction itself had (at that time) not been officially been announced. An opening bid, assuming the anonymous source is to be trusted, is said to be 90 to 100 million dollars. Usually, such bids are known as a stalking horse bid, intended to set a floor for a court-supervised auction.
This filing for bankruptcy is usually used to stay claims from creditors, including court judgments. This allows companies more time and control over the reorganizing process associated with running a company. Given that the company itself is going up for sale though how this will end up remains to be seen.
Hulk Hogan sued Gawker in 2012 over the publication of a black and white sex tape featuring him having sex with the wife of a former friend of his at the time. It was in March of 2016 that the court ruled in his favor awarding him 115 million dollars initially and an additional 25 million dollars in punitive damages leaving Gawker with a 140 million dollar lawsuit to pay. Gawker does still plan to appeal this case, how successful it will be remains to be seen.
Publishing group Ziff Davis has announced tentative plans to buy out seven of Gawker Media’s sites. Ziff Davis CEO Vivek Shah said this earlier today in a memo sent out to the company:
Ziff Davis has entered into an asset purchase agreement to acquire all of these properties (free of GMG’s liabilities), subject to the outcome of a Court-supervised auction. Under the Chapter 11 process, the Bankruptcy Court will soon set a schedule for other potential bidders to enter the sale process. There will then be an auction, which will likely take place at the end of July. In the event we become the acquirer, the additions of Gizmodo, Lifehacker and Kotaku would fortify our position in consumer tech and gaming. With the addition of Jalopnik, Deadspin and Jezebel, we would broaden our position as a lifestyle publisher. […] We look forward to the possibility of adding these great brands – and the talented people who support them – to the Ziff Davis family.
Ziff Davis also owns IGN, one of the largest gaming sites in the industry. It is unknown if under this plan Kotaku will merge with IGN, or if Kotaku will continue to stay as a seperate site
How this will affect writers at Gawker will remain to be seen, but we will be sure to keep you informed of anything interesting coming up regarding this rather astonishing event in news media history.