Hulk Hogan Wants to Keep Preference Actions
New York, June 21, 2016 – Gawker Media, a privately-held online media company has initiated an adversary case against a former pro-wrestling champ, Terry Gene Bollea, also known as Hulk Hogan, as part of an effort to hold back Hogan and potentially ward off a personal bankruptcy for Gawker’s founder and owner Nick Denton. The media company alleged that a $140 million final judgment in favor of Hulk Hogan in the invasion-of-privacy lawsuit would have a crippling effect on the Debtor’s estates, prospects of reorganization, and distribution to creditors.
Hogan has filed an objection to Gawker’s plan to sell itself to Ziff Davis or a higher bidder at a bankruptcy auction, on the grounds the sale will unfairly trade away potentially valuable rights. The objection focused on the inclusion of avoidance actions as part of the package of assets being sold. Hogan alleged that selling the avoidance actions could be particularly unfair in Gawker’s case, because that money could be subject to reclamation by creditors and the sale of the lawsuit rights “frustrates the policy goals” behind avoidance actions.
Gawker filed for Chapter 11 bankruptcy, after the media house was ordered to pay up $140M to Hulk Hogan for publishing a report, commentary, and accompanying video excerpts involving Hogan’s extramarital affair. Gawker Media and Denton was allegedly jointly and severally liable on $115 million of the judgment with an additional $10 million worth of punitive damages assessed against Denton separately. However, for now the media house has managed to get a temporary restraining order against Hogan from taking steps to enforce a judgment against Denton for the $10 million for which Denton was personally liable.
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