Gawker Media filed for bankruptcy on Friday after losing a $140 million lawsuit that involved the publication of a sex tape involving former wrestler Hulk Hogan.

According to a report by Reuters, the move came after a judge refused to allow Gawker more time to appeal, forcing it to put up a $50 million bond towards Hogan's damages. While Gawker filed for bankruptcy, it listed Hogan as its biggest creditor.

It was revealed last month that billionaire tech entrepreneur Peter Thiel, one of the co-founders of PayPal and an early investor in Facebook, had been funding Hogan's lawsuit.

Gawker had outed him as gay in 2007 with the headline: "Peter Thiel is totally gay, people."

Thiel said he had secretly funded a team of lawyers to track down "victims" of Gawker and help fund their lawsuits against the company. Thiel said he had funded Hogan's legal costs to the tune of about $10 million.

Thiel told the New York Times that funding the lawsuit was one of the "greater philanthropic things that I've done." He also said that this wasn't the only lawsuit against Gawker that he had funded, but refused to divulge more details about it.

Nick Denton, the founder of Gawker, who is also gay, responded on twitter.

Gawker, which also owns Jezebel and Gizmodo, will be put up for auction with bids starting at about $100 million following interest from digital publisher Ziff Davis LLC. Ziff Davis owns a number of tech and gaming publications, including PC Magazine and IGN.

In the filing, Gawker said its assets are estimated to be worth $50 million to $100 million, whereas its liabilities are estimated to be between $100 million and $500 million.

Entering bankruptcy freezes claims from creditors â€“ including Hogan.

According to an article published in the Guardian, Hogan's legal counsel said: "We have every intention to continue to pursue our judgement against Gawker and to hold them accountable for violating Mr Bollea's privacy whether it be in the bankruptcy court or any other court."