PETITION

The Latest in the Peter Thiel vs. Gawker Saga

Peter Thiel is fashioning himself like a Die Hard villain: impossible to put down. Right before Thanksgiving, Buzzfeed reported that Thiel had filed an objection in bankruptcy court alleging that he was boxed out from bidding on Gawker's assets. This makes for an interesting - if not circular - state of affairs.

First, a quick recap. Thief’s involvement in the Gawker matter is well known by now; his support of Hulk Hogan’s lawsuit against the digital media rag put the company (and its founder) in bankruptcy. Now the company is trying to maximize the value of the "estate" in an effort to return as much to claimants as possible. Hogan - with his massive judgment claim - happens to be a large claimant.

In the objection filed on 11/22, Thiel argues that he could be the source of said maximized value; he would like to bid for the companies assets - including, interestingly, any and all claims that the plan administrator, Dacarba LLC, may be marketing to outsiders that could be pursued against Thiel himself. Which are, of course, assets of the estate (and were, to be clear, the bigger target of the objection). Like we said, this is a bit circular. Thiel backs Hogan. Hogan sues Gawker. Gawker goes bankrupt. Gawker's plan administrator and counsel seek to fulfill their fiduciary duties by maximizing value for the benefit of the estate and its creditors. Including claims against Thiel. Thiel seeks to buy the kit and caboodle (including claims). If he does, value goes to the estate and is used to pay…Hulk Hogan. Bankruptcy = awesome.

The reactions to this circus were fast and furious:

Many articulated concern about Thiel’s nefarious intent: is he interested in a Big Brother-esque cleansing of Gawker and its archive from existence?

Others clowned on Dacarba’s liberal reliance on Precedent Transaction Analysis and the $36mm “buy-it-now” price. We don’t, however, necessarily see an issue with it: aim high we say. After all, there isn't a tremendous amount of truly comparable precedent for well-known digital media URL addresses (and archives) being sold in bankruptcy (though we’re happy to be proven wrong). Test the market, we say. MAKE a market, we say.

Regarding the marketing of claims against Thiel, the market is awash in new funds pursuing litigation finance strategies and looking for yield. It’s also, no doubt, awash in folks who would love to stick it to Thiel. So, why not go for that strategy? It actually demonstrates an awareness of the current litigation (and lit finance) environment.