Facebook has chosen to keep the billionaire who helped fund a sex tape legal case against Gawker Media on its board of directors.
The social network’s chief operating officer Sheryl Sandberg confirmed the decision to retain Peter Thiel during her appearance at the Code Conference.
Mr Thiel has said he wants to challenge Gawker’s “bullying” behaviour.
But he has been criticised for using his wealth to try and silence part of the media.
That poses a potential issue for Facebook at a time when it is trying to convince parts of the industry to host articles on its platform, provide it with exclusive video content and allow the tech firm to sell advertising on their behalf.
“Peter did what he did on his own, not as a Facebook board member,” Ms Sandberg told attendees at the California event.
“We have very independent board members with very independent thoughts that they share publicly. Those strong people make really good board members because they have strong views and they’re not afraid to think differently than other people, which has served Facebook well.”
But one expert questioned whether the decision to keep on Mr Thiel – who was one of Facebook’s early investors – was sustainable in the long-term.
“Facebook has always fundamentally seen itself as a technology company, but is now having to deal with the public position – and also the ethics and responsibilities – of being a publisher,” media consultant Steve Hewlett told the BBC.
“Imagine that this person were sitting on the board of The Times or the BBC – that would look like an obvious conflict of interest. You can’t have a billionaire sitting on a publisher’s board who is suing other people for publishing things.
“So, if you think of Facebook as being a publisher, this is plainly problematic.”
The clash between Gawker and Mr Thiel dates back to 2007, when the media firm published an article headlined: “Peter Thiel is totally gay people”.
Last week, the venture capitalist revealed to the New York Times that he had subsequently funded a team of lawyers to find and help “victims” of other Gawker articles sue the firm – an act he described as “philanthropic”.
One case resulted in a jury ordering Gawker to pay Hulk Hogan $140m (£97m) after it decided the publication of a sex tape featuring the ex-professional wrestler amounted to an invasion of privacy.
Gawker is appealing against the ruling, which threatens its future.
The publisher has also challenged Mr Thiel’s involvement and questioned his continued role at the social network.
“As a Facebook board member, how have your own views on politics and news influenced your contribution to corporate decisions?” asked Gawker’s founder Nick Denton in an open letter.
Jeff Bezos, the chief executive of Amazon and owner of the Washington Post newspaper, was critical of Mr Thiel earlier in the week during his own appearance at the Code Conference.
“I don’t think a billionaire should be able to fund a lawsuit to kill Gawker,” he said.
“Seek revenge and you dig two graves. One for yourself.”
Facebook’s chief executive Mark Zuckerberg rebuked one of its other directors, Marc Andreesen, earlier in the year for criticising India’s action against the firm’s Free Basics scheme.
But Ms Sandberg said the circumstances involving Mr Thiel were different.
“[In the earlier case] it almost felt like he was speaking for Facebook,” she explained.
Even so, one company watcher suggested Ms Sandberg’s comments were unlikely to end the matter.
“Media critics clearly see Thiel’s actions as a threat to free speech, if not the entire news business,” said Graham Lovelace from Lovelace Consulting.
“Some are trying to bring Facebook into that, because of its record in championing free expression.
“It highlights the debate around Facebook’s identity as it continues to grow.”
Shareholders in the social network have an opportunity to question its decision at its annual stockholder meeting on 20 June.