Gawker Settlement Approved in BR

This week, Gawker Media won court approval to repay creditors and settle the $140 million legal judgment awarded to former wrestler Hulk Hogan that drove the online publisher into Chapter 11 Bankruptcy. U.S. Bankruptcy Judge Stuart Bernstein of New York signed off on Gawker’s reorg plan. The settlement pays Hogan $31 million to resolve privacy litigation over Gawker’s publication of a highly publicized sex video. Approval of the plan ends a four-year legal fight between Gawker and Hogan in a case tried before a Florida jury earlier this year. Liability for the resulting verdict in Hogan's favor and Gawker’s failure to stay the judgment for purposes of appeal forced the bankruptcy. Reportedly, lawyers involved in the settlement say this brings the case to a close and extinguishes any possibility of appeal. Gawker sold most of its blogs, excluding its namesake site, to Univision for $135 million. Gawker’s Chapter 11 plan splits the company’s assets and sale proceeds among its creditors. The plan also includes settlements of other defamation lawsuits. Gawker maintained its stories subject to lawsuits were true, arguing First Amendment protection, but the expense of continuing to defend litigation would have been too much. Judge Bernstein said each of the settlements was reasonable for Gawker in light of the circumstances. The deal also shields former writers and editors from future lawsuits. In exchange for receiving that protection, the writers agreed to relinquish their rights to indemnification. The Wall Street Journal writes that the releases raised a novel issue on the intersection of bankruptcy law and the First Amendment and elicited a legal brief from a collection of journalism organizations in support of the legal protections. See more here-- http://on.wsj.com/2hjh0Bt