NEWS – Does Peter Thiel’s Participation In The Gawker Case Constitute an Unpermitted Assignment of a Chose In Action?

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I’m sure somewhere someone with greater knowledge than I have is writing a more scholarly consideration of this matter than I am capable of but this question occurred to me when I learned of Peter Thiel’s sponsorship of Hulk Hogan in his action against Gawker for defamation and for the more newly conceived tort of invasion of privacy. First, a little black-letter law as gleaned from USLEGAL.COM.

“Law stipulates that personal tort claims are not assignable and hence, injuries which are purely personal in nature, such as  distress, cannot be assigned to another person.[i] In the absence of a statute allowing the survival of personal torts, unliquidated and unvested personal torts claims are not assignable.[ii] Therefore, individuals are prohibited from assigning to a third person, a cause of action in tort for a personal injury that does not survive the death of the person injured.
Examples of personal tort claims that are not assignable include assault and battery, personal injury, false imprisonment, malicious prosecution, invasion of privacy, conspiracy and unfair and deceptive trade practices. In addition, courts have held that defamation is a personal injury claim and hence is not assignable. The court differentiated the nature of defamation and observed that defamation invades the interest in personal or professional reputation and good name, vindicating personal interests.[iii]”
Now, a little issue spotting: Is Hogan’s action a personal tort? The defamation claim certainly is and I see no distinction in the invasion of privacy claim that would cause a different conclusion. Was there an assignment? Superficially, it would seem the answer is no. The elements of an assignment are, I think, an intention on the part of the parties that the property be assigned and the receipt of consideration by the assignor. Surely the funds advanced by Thiel constitute consideration whether or not there is an agreement for reimbursement. Is there an outright assignment of the case such that Thiel became the plaintiff of the action? No, there wasn’t but, then again, we know the court would not have permitted the substitution of parties. Is there an assignment of the monetary proceeds of the action? That’s a question of fact but for our purposes let’s assume there is not. Is there a de facto or equitable assignment of some benefit resulting from a successful outcome for Hogan in the case? This is where I would argue things get sticky. Assuming the Hulkster keeps the dough, Thiel is still getting the benefit he most desired out of the action – vengeance. He and Hulk wanted to do damage to Gawker and it’s fair to say they shared in that reward. Now, maybe this is all gobbledygook. It’s been a long time since I’ve engaged in this kind of exercise. I’m no maven on the law. I don’t even know what I’m citing in the USLEGAL excerpt above. Still, there’s something about the bankrolling of someone else’s personal grudge that’s troubling. Could Hogan have pursued his action without Thiel’s animus? Would he have found counsel willing to take the case on contingency after an evaluation of it’s merits? If the action was found against Hogan and the case turned out to be nothing but a nuisance suit, does that change the evaluation? I dunno. I’m better at raising issues than I am at resolving them. Seems worth considering, though.
### This is the more expert piece I knew was out there: http://overlawyered.com/2016/05/champerty-maintenance-explainer-gawkerhoganthiel-edition/

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