SAN DIEGO _ Fact-checking site Snopes.com is asking readers to save the advertising-funded sleuthing service, which is in dire financial straits. The company is seeking donations through a GoFundMe campaign, which has raised upward of $130,000 of its $500,000 goal in a matter of hours.
The reason for the plea is this: Behind the scenes, Snopes is engaged in a contentious legal battle with San Diego-based internet media company Proper Media, whose directors hold minority equity stakes in Snopes parent company, Bardav, Inc.
Established in 2003, Bardav, Inc. was the joint venture of Snopes creator David Mikkelson and his then-wife Barbara Mikkelson, who each owned one share and 50 percent of the company. The couple divorced in 2015. In July of 2016, Barbara sold her stake to Proper Media's five equity holders for $3.6 million.
Prior to the sale, Bardav had contracted Proper Media for web development and advertising services on Snopes.com, with the companies agreeing to split revenue earned from advertisements.
In May, Proper Media filed suit against Bardav and Mikkelson with the San Diego Superior Court of California over ownership of the site, alleging that Mikkelson attempted to gain control over the business and block Proper Media from its share of profits. Snopes counter sued, arguing that Proper Media has not paid Snopes its share of advertising revenue since March. Motions by both the plaintiffs and defendants are scheduled to be heard on Aug. 4.
Monday, Snopes, went public with its financial plight, soliciting readers via e-mail and a post on the website for $500,000 in donations to keep the site afloat.
"Our legal team is fighting hard for us, but, having been cut off from all revenue, we are facing the prospect of having no financial means to continue operating the site and paying our staff (not to mention covering our legal fees) in the meanwhile," Snopes said in a post published to its website.
In seven hours, the campaign has generated more than $130,000 in funds from over 4,400 donors.
In an emailed statement, Proper Media's lawyer Karl Kronenberger asked the media to, "conduct its own fact-check of the fundraising plea posted today on Snopes.com. ... Today's post only confirms Proper Media's allegations that Mr. Mikkelson has drained the company's bank accounts and is unable to operate Snopes profitably without Proper Media's expertise and management."
