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Gawker Develops Plan for Bankruptcy to Help Creditors Collect Debts

Posted on in Chapter 11

Gawker Develops Plan for Bankruptcy to Help Creditors Collect Debts

In 2016, online media group Gawker filed for Chapter 11 bankruptcy. It is now in the process of developing its bankruptcy plan, which will allow for its payment to individuals and groups involved in litigation against the group. Over the years, multiple parties, including former professional wrestler Hulk Hogan, have filed claims against the group alleging misconduct. Under its current proposal, Gawker will allocate $40 million for the repayment of its outstanding debts, which include its payment to Hogan and other parties, including a freelance contributor to the site who filed a lawsuit regarding a piece she wrote about the dating app Tinder. Under the deal, another $40 million is set aside for parties with stakes in Gawker

According to a lawyer for the company, the current bankruptcy plan will allow for Gawker to repay its debts to its creditors. This is the purpose of any bankruptcy case – to allow an indebted party to get out of debt by repaying its creditors. This is true regardless of the size of the company, whether it is a multi-million dollar media group or a small retail store. Chapter 11 involves the reorganization of a company in an effort to make it profitable once again. In August 2016, it was announced that television network Univision purchased Gawker Media and renamed the set of assets Gizmodo Media Group. Univision is the largest Spanish-language broadcaster in the United States.

Multiple Parties with Lawsuits Against Gawker Repaid Under Bankruptcy Plan

Former professional wrestler Hulk Hogan filed a lawsuit against Gawker in 2012 when the media group published a video of him engaging in an adulterous affair. Gawker agreed to pay him $31 million to settle the case. In addition to this and the others to whom Gawker owes compensation following defamation suits, it has agreements with its creditors to repay debts. As part of the bankruptcy plan, all former writers, employees, and contractors who worked with Gawker are barred from filing lawsuits against the company in the future.

These issues are in addition to Gawker founder Nick Denton's personal bankruptcy case, which he filed in August. Gawker hopes to settle claims against Denton that are tied to his work with the company.

The bankruptcy has been a long, contested, difficult process for all parties involved. Currently, the company's creditors are voting on the debt repayment plan for the media group, which will bring the bankruptcy process closer to completion.

Work with an Experienced Elk Grove Bankruptcy Lawyer

If you are a business owner considering filing for bankruptcy, no matter what type of business you operate, work with an experienced bankruptcy lawyer to ensure that your case remains on schedule and that you follow all rules for filing and pursuing a bankruptcy case properly. Contact our team of bankruptcy lawyers at Newland & Newland, LLP today to set up your initial legal consultation with us. We serve clients in the Arlington Heights, Palatine, Rolling Meadows, Libertyville, Mundelein, Buffalo Grove, Schaumburg, Elk Grove, and Itasca areas from out our office located in the prestigious 180 North LaSalle street building in Chicago.

(image courtesy of Miguel Discart)

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