This week marks the sixth anniversary of Terry Bollea (AKA professional wrestler Hulk Hogan) suing Gawker media for publishing a sex tape of him with a married woman. The suit made national news not just for its salacious nature—but because of the questions it raised regarding privacy versus journalistic freedom. Once news emerged that billionaire and PayPal co-founder Peter Thiel was funding Hogan’s claim, the case became even more sensational. In this piece, we’ll take a look at exactly what happened in the case, and how it impacted (or hasn’t impacted) Litigation Finance. The Facts of the Case In 2007, Gawker, a website known for celebrity scandals and salacious content, published a piece with the headline: “Peter Thiel is totally gay, people.” Was this newsworthy? Did the piece have journalistic integrity? Reasonable people can disagree. Peter Thiel is in fact gay, which means the truth of the article protected Gawker from a libel suit. In 2009, an outed Thiel gave an interview in which he called Gawker ‘destructive,’ even as he acknowledged that the site wasn’t focused on ruining him personally. Thiel also speculated that Gawker maintained a disdainful attitude toward Big Tech, and may be focusing on punishing industry leaders as a result. Fast forward to 2012, when Gawker published a lewd video featuring wrestler Hulk Hogan (AKA Terry Bollea) having sex with Heather Clem—wife of radio personality “Bubba the Love Sponge.” This led to Bollea suing the media outlet for infringement of rights of publicity, invasion of privacy, and intentional infliction of emotional distress. Bollea was represented by famed Los Angeles attorney Charles Harder. The published video, which Bollea claims was recorded without his knowledge or consent, contained a 2-minute section of a 30+ minute video—ten seconds of which included explicit sex acts. In 2016, Forbes magazine revealed that it was indeed Peter Thiel who was bankrolling Bollea’s case against Gawker. Speculation soared over what was viewed by many as Thiel’s revenge against Gawker for outing him. Did he want to ruin the media company, or purchase it, or simply malign the company that caused him personal and professional anguish? Thiel maintained that his involvement was philanthropic at heart, and meant to protect people from being bullied by unscrupulous media outlets. If anything, the lawsuit was meant to deter Gawker from intentionally releasing damaging content that lacked legitimate news value. Gawker founder Nick Denton, who was named personally in Bollea’s claim, made a statement about Thiel’s involvement in the case: “Just because Peter Thiel is a Silicon Valley Billionaire, his opinion does not trump our millions of readers who know us for routinely driving big news stories.” Also in 2016, a jury awarded Bollea compensatory damages of $115 million, plus punitive damages of $25 million—finding Gawker liable. A few months later, Gawker filed Chapter 11 bankruptcy, and began looking for a buyer. Several media outlets owned by Gawker were sold. By November 2016, Gawker and Bollea reached a settlement of $31 million. Today, Gawker’s flagship gossip site is still active. Gawker media sold off several of its prominent sites including Gizmodo, Jezebel, Deadspin, and io9. The LF Connection The case itself was of particular interest in and around the Litigation Finance community. Opponents of third-party legal funding asserted that Thiel’s actions in the case laid out an effective blueprint for the very wealthy to bankroll frivolous, but eye-catching cases. Billionaires could, some posited, use their wealth and legal connections to target specific companies, forcing them into bankruptcy. This speculation took place alongside the typical accusations that third-party litigation funding could clog court dockets with meritless actions meant to be quick paydays for funders and their clients. For example, Peter Sheer, a First Amendment expert, suggested that Thiel and others might abuse the power of third-party legal funding to intimidate media outlets. According to Sheer: “Winning is the ultimate chilling effect, but if you can’t win the case, you at least want the editors to think twice before writing another critical story about you.” To the keen-eyed observer though, it’s clear that Peter Thiel neither incited this case, nor had any real control over its outcome. Bollea initiated the case before Thiel’s involvement. At the time the case was decided, the jury was unaware that Bollea had a benefactor. And since the jury ruled in favor of Bollea, not Gawker, it’s clear that the case had merit. Thiel was always adamant that funding Bollea’s case (to the tune of $10 million) was about deterrence, not revenge. He explains that he wanted to “fight back” against Gawker’s practice of damaging reputations and bullying those with no means to pursue a claim to conclusion. As Thiel explains, “...even someone like Terry Bollea, who is a millionaire and famous and a successful person didn’t quite have the resources to do this alone.” While one could view Thiel’s actions as being contradictory to the principles of free speech—he disagrees. In fact, Thiel has donated to free speech defenders like the Committee to Protect Journalists. Thiel maintains that there is a profound difference between journalism in the public interest, and the type of media Gawker traffics in. That’s why he decided to take action. Thiel told the New York Times, “It’s less about revenge and more about specific deterrence. I saw Gawker pioneer a unique and incredibly damaging way of getting attention by bullying people even when there was no connection with the public interest.” Now, six years after the case has concluded—what have we learned? We haven’t seen a rash of billionaires funding cases, frivolous or not, with the intention of bringing down specific companies. That’s not to say billionaires aren’t financing claims the way Thiel did, only that they aren’t doing so publicly. Unlike traditional litigation funders, Thiel did not stand to make any money from Bollea’s lawsuit. Technically, Thiel should still be considered the litigation funder, though his term sheet wouldn’t be one most funders would want to imitate. The Gawker case has not led to a slew of frivolous, funded claim. Among other reasons, it simply doesn’t make financial sense to invest in a case lacking in merit. Bollea’s accusations against Gawker were affirmed by the jury, which resulted in a large award. So this claim was meritorious, even if Thiel’s motivation for funding the claim were not ROI-based. Media outlets are not cowering en masse over fears of punitive lawsuits from billionaires. That was much ado about nothing. Holding media outlets accountable for what they print (and occasionally, their motivations for doing so) is a vital and essential part of the free press. Free speech is not freedom to print anything—even something as personal as a sex tape—merely as an attention-getting device. Final Takeaways Can a lawsuit fall under the purview of Free Speech? Thiel believes so, and many others agree. This case addressed questions of privacy, free speech, and litigation funding. The end results demonstrated that we are all entitled to some element of privacy—even the celebrities among us. The Gawker case also affirmed that litigation funding still serves the interests of justice by enhancing the ability of claimants to bring lawsuits when they are wronged. The takeaway here should be that Peter Thiel afforded Hulk Hogan access to justice. Of course, when a billionaire backs a professional wrestler against a media company, sometimes the moral of the story can get lost beneath the headlines.

The following article was contributed by Valerie Blacker and Jon Na, of Piper Alderman. Applicants often confront the proposition, which respondents typically use in their defense, that terms in consumer contracts will effectively exclude or restrict the claims that have been brought. The High Court of Australia recently weighed in on this issue, deciding that a mortgage contained an enforceable promise by the borrowers not to raise a statutory limitation defense in relation to a claim by the lenders, which was commenced out of time. Price v Spoor [2021] HCA 20 In a slight twist to the typical scenario, the lenders were the plaintiffs who brought recovery proceedings after the expiry of the period stipulated in Queensland’s Limitation of Actions Act 1974. The borrowers argued no monies were owed because the claim was well and truly statute barred. Proceedings should have been brought by 2011, but the lender did not file a claim until 2017. In reply, the lender relied on this clause in the contract: “The Mortgagor covenants with the Mortgage[e] that the provisions of all statutes now or hereafter in force whereby or in consequence whereof any o[r] all of the powers rights and remedies of the Mortgagee and the obligations of the Mortgagor hereunder may be curtailed, suspended, postponed, defeated or extinguished shall not apply hereto and are expressly excluded insofar as this can lawfully be done.” The effect of which was said to be a promise not to take the limitation point. The lender’s argument failed at first instance (before Dalton J) but was overturned on appeal (by Gotterson JA on behalf of Sofronoff P and Morrison JA) and then ultimately vindicated by the High Court (Kiefel CJ and Edelman J, with whom Gageler, Gordon and Steward JJ agreed). The public policy principle Part of their Honours’ reasoning was that what is conferred by a limitations statute is a right on a defendant to plead as a defense the expiry of a limitation period. A party may contract for consideration not to exercise that right, or to waive it, as a defendant. That is not contrary to public policy. This, in our view, is akin to agreements frequently entered between prospective parties to a litigation to toll a limitation period (suspend time running) for an agreed amount of time. That can be contrasted with a clause in an agreement that imposes a three- year time limit instead of six, for bringing a claim for misleading and deceptive conduct under the Australian Consumer Law.[1] Clauses of that kind are unenforceable based on a well-established principle that such clauses impermissibly seek to restrict a party’s recourse to his or her statutory rights and remedies, contrary to law and public policy. The “public policy principle” was first identified by the Full Court of the Federal Court in Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) (1988) 39 FCR 546. Henjo has been referred to and applied in numerous cases since, and cited with approval in the High Court.[2] This is not to say that contractual limitations can never be effective in limited circumstances - this much was shown in Price v Spoor. The question of whether commercial parties to a contract can negotiate and agree on temporal or monetary limits while not completely excluding the statutory remedies for misleading and deceptive conduct claims under section 18 of the ACL remains debatable[3]  - but those specific circumstances do not arise here. About the Authors: Valerie Blacker is a commercial litigator focusing on funded litigation. Valerie has been with Piper Alderman Lawyers for over 12 years. With a background in class actions, Valerie also prosecutes funded commercial litigation claims. She is responsible for a number of high value, multi-party disputes for the firm’s major clients. Jon Na is a litigation and dispute resolution lawyer at Piper Alderman with a primary focus on corporate and commercial disputes. Jon is involved in a number of large, complex matters in jurisdictions across Australia. For queries or comments in relation to this article please contact Kat Gieras | T: +61 7 3220 7765 | E:  kgieras@piperalderman.com.au -- [1] For example in Brighton Australia Pty Ltd v Multiplex Constructions Pty Ltd [2018] VSC 246 [2] For example in IOOF Australia Trustees (NSW) Ltd v Tantipech [1998] FCA 924 at 479-80; Scarborough v Klich [2001] NSWCA 436 at [74]; MBF Investments Pty Ltd v Nolan [2011] VSCA 114 at [217]; JJMR Pty Ltd v LG International Corp [2003] QCA 519 at [10]; JM & PM Holdings Pty Ltd v Snap-on Tools (Australia) Pty Ltd [2015] NSWCA 347 at [55]; Burke v LFOT Pty Ltd [2002] HCA 17 at [143]. [3] For example in G&S Engineering Services Pty Ltd v Mach Energy Australia Pty Ltd (No 3) [2020] NSWSC 1721.