Silicon Valley billionaire Peter Thiel has struck a settlement with the bankruptcy estate of Gawker and has agreed not be pursue the debtor's assets at an upcoming auction.
The development comes nearly two years after Gawker filed for Chapter 11 after being hobbled by a Hulk Hogan lawsuit secretly funded by Thiel.
After declaring bankruptcy, Gawker sold many of its media properties to Univision for $135 million, but the flagship Gawker.com wasn't included in the sale. As Gawker investigated legal claims against Thiel for his role in helping to bring down the company, Thiel himself indicated interest in participating in an auction and acquiring the rest of Gawker's assets, which includes archives.
On Wednesday, the administrator of Gawker's estate sought approval of an order approving a release with Thiel, who co-founded PayPal and was one of the first investors in Facebook.
According to the filing, it was believed that Thiel's participation in the auction could have a "chilling effect" on bidding and that the auction would "elicit greater interest and higher bids" without Thiel's participation.
As part of the settlement agreement, Thiel not only agrees to stay away from buying Gawker, but also won't participate in any legal action over the website's archives. Thiel will be releasing any claims against Gawker as well.
In return, the Gawker administrator has agreed to terminate its own investigation of Thiel and will be withdrawing subpoenas issued for the intention of discovery. Earlier this year, a bankruptcy judge ruled that Thiel and Charles Harder's law firm had to comply with demands for information about the funding of several lawsuits, including the Hogan case involving the publication of a sex tape excerpt.
News of the bankruptcy filing indicating Thiel wouldn't be buying Gawker was first reported by The Wall Street Journal.