A billionaire just helped bankrupt Gawker Media founder Nick Denton. Who should you be cheering for?

Gawker Media suffered another blow this week when its founder, Nick Denton, filed for personal bankruptcy.

Gawker's financial woes have been dragging on for months in a bitter court battle with former pro wrestler Hulk Hogan over a sex tape published on Gawker.com.

The media company is best known in Canada as the gossip rag that first went public with news of the now-notorious Rob Ford crack video. But Gawker Media and its founder have made plenty of enemies over the years.

Last March, a jury awarded Hulk Hogan - whose real name is Terry Bollea - a staggering $140 million in damages. Gawker Media filed for bankruptcy protection in June.

Denton says he personally owes Hulk Hogan $125 million dollars. And he blames that on tech billionaire and Paypal founder Peter Thiel, who funded Hogan's lawsuit.

Denton says Thiel has a personal vendetta against him since 2007, when Gawker.com publicly outed him as gay.

There's a fine line between being entertainingly cynical and being so cynical that it's tiresome.-

And Thiel himself has alluded to the truth of that, telling the New York Times that he funded the Hulk Hogan lawsuit and several others to send a message to Gawker.

For Denton and his supporters, the lawsuit is an assault on freedom of the press. They say it's proof that a wealthy investor can stifle dissent with just the wave of a chequebook.

But journalist Ben McGrath, who profiled Denton for the New Yorker back in 2010, says there's more to the story than that. 

As he tells Day 6 guest host Marcia Young, Thiel isn't simply out to get revenge.

"In Peter Thiel's mind, he's saving private citizens as well as tech billionaires from [Gawker's brand] of gutter-snipe publishing."

According to McGrath, Denton founded Gawker Media as a tabloid-style gossip blog that aimed "to puncture the pieties of the New York City media elite."

"He was frustrated that when all his reporter friends would go to the pub after work, they would be talking not about the stories they'd just filed but about all the things they'd left out of those stories," McGrath says.

"Which is to say, gossip — things that either were not quite provable, or things that were thought to be too uncouth, too salacious, for print."

[Denton] believed that gossip would set you free.-

Over time, Gawker Media set its target on elites in other industries, including the tech sector. And Thiel wasn't the only one who was put off by the company's unapologetically gossip-driven approach to media.

"There's a fine line between being entertainingly cynical and being so cynical that it's tiresome," says McGrath.

Who's the villain?

Denton says his ultimate goal was the same as any other journalists': To speak truth to power.

"He believed that gossip would set you free — that gossip was a truly democratizing force, and that power hid in secrets," McGrath explains.

"On the other hand… the kind of hypocrisy that seemed to interest [Gawker] often was of a sexual nature, and that's ultimately, I guess, what got them kind of caught up here."

I would think anyone has to be concerned that a billionaire can stifle dissent, however unappealing the particular hill that this battle is being fought on may seem to you.- 

Thiel, on the other hand, sees his efforts to take Gawker down as an altruistic act.

"His logic is that Gawker and its ilk carry out practice a kind of journalism by terrorism — basically, without consideration to innocent bystanders and without adherence to any code. There's an element of truth to that, but on the other hand, there's a sense in which he's playing God."

"I would think anyone has to be concerned that a billionaire can stifle dissent, however unappealing the particular hill that this battle is being fought on may seem to you."

Gawker Media is currently up for sale, and McGrath believes the company — which publishes a wide range of blogs like Jezebel and Deadspin which are well-established in their own right — will survive.

But the fate of the company's flagship site, Gawker.com, is less certain.

"There is a question about what happens to Gawker itself when it doesn't have Nick Denton driving it; because he was always the animating impulse behind it," says McGrath.

"You could argue that in this bankruptcy, Gawker has become an emblem of noble failure."