A Blog by Jonathan Low


Feb 28, 2018

The Most Expensive Comment In Internet History?

Internet censorship by those who can afford to do so - or defense of the right to privacy (by an internet billionaire who is among those who perfected the processes by which personal information is collected, curated and commercially applied)?

The answer depends on your personal point of view. But one thing is certain, both the censorship and attacks on privacy will continue. JL

Derek Thompson reports in The Atlantic:

In 2016, Hulk Hogan, the professional wrestler, won a nine-figure lawsuit that ultimately bankrupted Gawker Media. The lawsuit concerned a video of Hogan (né Terry Bollea) having consensual sex with his best friend’s wife, while that same friend recorded the encounter—secretly. In 2007, Gawker’s tech blog Valleywag published a post under the headline “Peter Thiel is totally gay, people.” Thiel, the billionaire investor, exorcis(ed) a deep grudge by bankrolling Hogan’s lawsuit to destroy the media company.

Bollea v. Gawker isn’t just one of the most consequential lawsuits in the history of modern American media. It’s also probably the strangest. In 2016, Hulk Hogan, the professional wrestler, won a nine-figure lawsuit that ultimately bankrupted Gawker Media, a fleet of sites that epitomized the barbed brilliance of New York’s young media crowd. The lawsuit concerned a video of Hogan (né Terry Gene Bollea) having consensual sex with his best friend’s wife, while that same friend recorded the encounter—secretly, according to Hogan and later reporting. Behind the scenes of this tawdry affair, a more shocking story was playing out, in which Peter Thiel, the billionaire investor, seemed to be exorcising a deep grudge against Gawker by bankrolling Hogan’s lawsuit to destroy the media company that published the sex tape.This saga is the subject of a new book by the author and (controversial) media strategist Ryan Holiday, called Conspiracy: Peter Thiel, Hulk Hogan, Gawker, and the Anatomy of Intrigue. Shortly after the verdict, both Thiel and Gawker’s founder, Nick Denton, reached out to Holiday about his coverage of the lawsuit in the New York Observer. Over the next two years, Holiday turned that access into the first reported book that chronicles the lawsuit, from the offending blog post that sparked Thiel’s wrath to the aftermath of Gawker’s sale.
In the book’s biggest revelation, Holiday reports for the first time that a twentysomething acquaintance of Thiel’s, identified only as Mr. A, not only came up with the idea in April 2011—before the publication of the Hogan video—to target Gawker through an open-ended legal fund but also spearheaded the plot to take down Gawker using Thiel’s money.
I spoke to Holiday last week about the new information he’s uncovered, whether he thinks Gawker could have saved itself before the trial, and whether news reporters reflecting on Gawker’s demise should live in fear of upsetting rich people with their work. This interview has been edited and condensed for clarity.

Derek Thompson: On December 19, 2007, Gawker’s tech blog Valleywag published a post under the headline “Peter Thiel is totally gay, people,” ending with the sentence, “I think it's important to say this: Peter Thiel, the smartest VC in the world, is gay. More power to him.” Based on your conversations with Thiel, why do you think he’s so mad about this blog post, if most of his friends (and their friends) knew he was gay?
Ryan Holiday: My initial instinct was that it must have been pure anger. What was strange, though, is that in speaking to Peter Thiel, I never saw the anger. Of course, sources can present a mask. But I feel like I would have seen a flicker of it.
I think what happened was this: The article comes out, and it is a rude awakening for a private person. The article was legal, but it was also tasteless and deliberately insensitive. But what Peter reacts to the most is the comment on the bottom, which was written by Denton. [The comment is one sentence long: “The only thing that’s strange about Thiel’s sexuality: why on earth was he so paranoid about its discovery for so long?”] He thought Denton was implying that Peter had psychological problems. When you read the comment it doesn’t feel that way. But Thiel thought, here is the publisher of a media outlet, not just a blogger, going after me. That blog post felt like the first article in years of negative Gawker coverage against Thiel.
Thompson: Since Thiel’s war on Gawker bankrupted the company, that’s probably the most expensive internet comment in world history. I was really struck by your reporting that Thiel went around calling Gawker “the MBTO,” which stood for “Manhattan-Based Terrorist Organization.” Why did he feel terrorized?
Holiday: I think there is an element of unpredictability to it. Most of the media plays by certain rules. But Gawker wrote its own rules, and that scared certain powerful people. Outing was more or less off limits for most news outlets. So I think what kept Thiel and people like him up at night was: If they can out me, then what’s next? Will they publish a harmful rumor? Even a false rumor?
Thompson: Thiel ponders revenge for years. Then, as you report, in April 2011, he is in Berlin and he takes a dinner meeting with a then-26-year-old Thiel devotee, who you call Mr. A. This young man essentially tells Thiel, I know you’re obsessed with Gawker, and I have an idea to destroy them. He says Thiel should create a shell company to fund investigators and lawyers to find causes of action against Gawker and ultimately sue it into oblivion. He estimates that the plan will take up to five years and up to $10 million in funding, which is prophetic. What struck you most about Mr. A’s story?
Holiday: I was shocked by the very existence of Mr. A, this mysterious operative who put the plan in motion. Not only does nobody but me or the conspirators know his real name, but also nobody even realized that he exists. They don’t realize there was another senior-level person involved in the plot against Gawker. That’s fascinating for a story that has been reported so extensively for so many years.
was also shocked that multiple people [who knew Mr. A’s identity] referred to him as a “professional son,” as Lyndon B. Johnson was sometimes called, for his ability to identify father figures in his life that would help his career. His secret strength was to understand what powerful people wanted to see in a protégé or lieutenant and to make himself into that person. Thiel was speaking about Gawker. He despaired that he couldn’t take on the media publisher. And Mr. A said, “Peter, if everyone thought that way, what would the world look like?”
I’m not sure there is a more perfectly tailored line for a person like Thiel, at that point in his life, to fund a project like this. At the time, Peter had figured out all the things that wouldn’t work. But he recognized the potential in Mr. A’s plan the way a venture capitalist recognizes a great idea. Here, he thought, I have the right person behind the right idea, and I’m going to support it.
Thompson: That brings us to Hulk Hogan, where the story takes a truly surreal turn. To summarize from your interviews and reading of the court documents: It’s 2006, a year before the blog post outing Peter Thiel is published. Hogan’s marriage is falling apart. A distraught Hogan is invited to go to the home of his best friend, a shock jock by the name of Bubba the Love Sponge. Bubba tells Hogan that he can have sex with his wife to cheer him up. Hogan asks if the sex will be taped. Bubba, lying, says no. Then Bubba leaves and secretly records Hogan having sex with his own wife.
In 2012, these tapes are leaked to Gawker, which publishes the video under the headline: “Even for a Minute, Watching Hulk Hogan Have Sex in a Canopy Bed is Not Safe For Work but Watch it Anyway.” Hogan is mortified and tells reporters
that he’s going to sue for violation of privacy. News of this threat reaches Thiel’s legal team. They notify Hogan’s lawyers that they’re willing to bankroll a lawsuit against Gawker. And so, in October 2012, Hogan’s legal team files a lawsuit seeking damages of $100 million from Gawker Media for a handful of claims, including invasion of privacy, intentional infliction of emotional distress, and a violation of the Florida Security and Communications Act. Have I got that right?
Holiday: It’s even more unreal than that. Basically, Hogan had sex with his best friend’s wife. His friend kept those recordings in a desk by his radio station—that detail was verified by police reports. The Tampa Police and FBI both believed that a rival DJ broke into the desk and stole the videos. [Although police and FBI investigative notes revealed those suspicions, that DJ was never charged or convicted of any crime.] He started to leak the videos, not to embarrass Hoganbut to embarrass Bubba, whose time slot he was trying to steal. The speculation is that this entire series of events was triggered by a beef between two shock jocks in Florida. Gawker is a cat’s paw in an [alleged] extortion scheme. And Gawker was the only one punished for it. It is just so tragic and absurd.
Thompson: Now we get to the trial. I thought your book did a really great job of explaining how Hogan’s legal strategy so baffled Gawker’s lawyers, who seemed to gradually realize that they weren’t dealing with a rational legal strategy from a resource-constrained plaintiff.
Holiday: I read all 25,000 pages of legal documents from this case. That’s $2,000 dollars in printing costs. And what was so fascinating to me is that Gawker’s legal team doesn’t seem to take [Thiel’s strategy] into account at all. There is some reporting about Nick Denton growing suspicious about why Hogan wasn’t settling. [A legal analyst named] Dan Abrams published a piece, ”Might a Gawker Hater be Covering Hulk Hogan’s Legal Bills?”
If you’re fighting Hulk Hogan alone, you file motions and drag it out to be as painful as possible for Hogan, in the hopes that he’ll settle. But if you’re fighting a billionaire, what you do not do is try to drag out the trial as long as possible. That won’t work.
If Gawker suspected Thiel’s involvement, they should have publicly cast aspersions and even make a case to the jury that a billionaire was behind the whole thing. If you are being hounded by a billionaire, you want to make yourself as sympathetic as possible. But I suspect the Gawker team simply didn’t realize
If Gawker suspected Thiel’s involvement, they should have publicly cast aspersions and even make a case to the jury that a billionaire was behind the whole thing. If you are being hounded by a billionaire, you want to make yourself as sympathetic as possible. But I suspect the Gawker team simply didn’t realize what was happening until it was too late.
Thompson: One thing I’ve always been so curious about is how did Nick Denton first begin to suspect that the Hogan trial was bankrolled by Peter Thiel?
Holiday: I don’t know. And he wouldn’t tell me. I suspect it was cumulative. Things added up. Thiel and Charles Harder [the lawyer paid by Thiel to pursue cases against Gawker] made a mistake by filing additional lawsuits as they were approaching trial and immediately after trial. It made it overwhelmingly suspicious that there was something else going on.
Denton always thought today’s rumor is tomorrow’s news, and it was particularly brilliant that Denton ran the Gawker playbook to expose the person behind the lawsuit. First he floated a rumor, saying maybe someone, and even someone
from Silicon Valley, is funding Hulk Hogan. And then a few days later, Ryan Mac from Forbes broke the story that it was Peter Thiel. And then Thiel broke his silence in an interview with Andrew Ross Sorkin at The New York Times.
Thompson: Do you think Thiel could have avoided exposure entirely? Is there a way that his involvement might still be a secret?
Holiday: I don’t know how Ryan Mac from Forbes learned. He wouldn’t speak to me. But the circle of people who knew about Thiel’s plot was expanding to become a number too large to sustain by mid-2016. Peter had gotten so proud of what was happening that he was telling more people, which made his exposure inevitable. But, according to Charles Harder, even Harder did not know that Thiel was behind everything until the Forbes story broke. All Harder knew was he was working with Mr. A and an anonymous benefactor.
Thompson: You go to great lengths to demonstrate that Peter Thiel and Nick Denton are surprisingly alike—foreign-born, gay, entrepreneurial, libertarian in disposition, obsessed in their own way with the value of secrets. Their hostility in many ways seem like a narcissism of the small difference. If you could go back in time with Denton, how would you advise him to save his company?
Holiday: There was narcissism of the small difference. But their visions of the future were radically different. I’m not sure diplomacy could have worked even if they got in the same room with each other. From 2007 up until 2012, Denton was on a devil-may-care ride of breaking rules as a media publisher. And that was so diametrically opposed to Peter’s vision of quiet individuality, this belief that weirdos needed to be left alone if they were going to change the world. Peter saw that Gawker would punish people for that weirdness.
Thompson: In the book, you seem to side with Thiel over Denton and the plotters over Gawker. There is a section where you really seem to idolize Thiel and hold him up as a kind of hero conspirator. Am I wrong? Who did you find more persuasive?
Holiday: My intention was to take out as much judgment out as possible. One of
the hardest things of writing the book, and I wrestle now even talking to you, is that the Nick Denton and A.J. Daulerio [Gawker’s editor in chief when the video was published] that I talked to in 2016 and 2017 were thoughtful and mature and circumspect about a lot of these issues. But it’s hard to find that same circumspection at Gawker in the events of 2007 to 2016.
There is a line from Mr. A [in the book] where he says the more they studied Gawker, the harder it was to find good. And when you look at some of these stories with the distance of time, it was extraordinarily difficult to find that sort of humanness and sympathy. There is a famous tweet where a Gawker writer says he wrote a story about the actor James Franco where he called him gay and arapist. It was a toxic culture that spun out of control. And now that these writers are out of that culture, they’re sympathetic.

Thiel’s influence is scary and ominous. But what I found refreshing about it is the highly skilled competence. [The danger that readers will misunderstand the message of a book] is a worry for me personally because my first book, which was supposed to be an exposé of media manipulation, became quite popular with extremists that I don’t agree with. But the way Thiel took down Gawker is obviously a playbook to take down somebody like Donald Trump—a well-funded group of individuals probing for underlying weaknesses, doing the unpleasant and boring business of looking through the muck of old business dealings.

Thompson: I am much more sympathetic to Gawker in this case. I’m more nervous about the power of people like Thiel to silence the press and scared of juries’ power to determine newsworthiness and hand out $100 million punishments for true stories. As Tom Scocca, a former Gawker writer, put it, this is now “a country where a billionaire can put a publication out of business.”
Holiday: One of the things that’s most brilliant about Tom’s piece is that it sets into motion a lost cause mythology about Gawker. It recasts all sorts of things that Gawker did as rudeness or mere insensitivity. But Gawker Media had articles with leaked photos of female celebrities’ boobs. Those were real people on the other side of that article. That was a real violation of privacy.

That line from Tom redefines their past and redefines what happened. Denton was not extorted into shutting down the website. Gawker lost in a court of law in front of a jury and judge, for which they had numerous opportunities to push the verdict in another direction. But they lost the case in court as much as Thiel won it. There are many scary things this class of billionaires can do with their money. But meeting in open court about the illegal publication of a sex tape is not one of the scariest


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