Gawker Media filed for bankruptcy in New York on Friday after losing an invasion of privacy case brought by former professional wrestler Hulk Hogan and funded by tech billionaire Peter Thiel. The company listed a $130 million (€115m) claim from the litigation as "disputed" in its Chapter 11 petition.
Gawker said last month that it had hired a banker to explore strategic options, including a possible sale, as the digital media company fought the potentially crippling damages award.
Mr Hogan, whose real name is Terry Bollea, sued the media-and-celebrity-focused website in 2012 over the publication of a tape showing him having sex with a friend's wife, claiming the publication cost him endorsements and inflicted emotional harm.
Mr Thiel, the libertarian-leaning venture capitalist who co-founded PayPal and sits on the board of Facebook, made a financial contribution to the suit.
Gawker and Mr Thiel have a contentious history: the website outed him as gay in 2007. Mr Thiel has since publicly acknowledged that he is gay, and called Gawker’s now-defunct blog Valleywag the “Silicon Valley equivalent of al-Qaeda.”
In May, Gawker chief executive Nick Denton challenged Thiel to a debate.