He won a libel suit over being called gay. Which effectively sank him in the eyes of many cos suing over that seemed quite a homophobic thing to do.
I remember that & it was actually quite a bit more complex than "He got called gay so he sued & everyone thought he was a homophobe then."
He was publicly outed by an organisation which claimed to be a mob of gay activists "outing" celebs, sportspeople, prominent public figures even who were passing as hetero. They would take recent well known photos of their chosen targets and digitally manipulate them so the celeb was wearing a t-shirt that said "GAY AS FUCK". This apparently was empowering the gay community.
Well I was a part of the gay community - I mean obviously I still am but I got out a lot more in those days - and outing people was not something which any of us approved of. There were people living in fear that their careers would be ended if it happened to them. Their families split apart, their lives devastated. No one who wasn't gay 25-30-40 years ago can imagine what the societal implications of being involuntarily outed were . Nor of the damage it could do to one's personal and professional life.
In retrospect it's easy to say we all thought Donovan was a homophobe for doing it but at the time his victory in court made a lot of people rest far easier. Because as expected the group quietly disbanded in the wake of losing. You see, it was very easy for them to keep behaving like utter twats when other people were paying the price but when they had to pay it, their "activism" didn't seem that urgent to them any more.