Yahoo ‘Ordered To Pay $2.7 Billion’ By Mexican Court

December 3, 2012 0

Sunnyvale, California – In a most excruciating suit ever, brought by Worldwide Directories S.A. de C.V. and Ideas Interactivas, S.A. de C.V., accused Internet pioneer Yahoo of breach of contract related to a yellow-pages listing service, as the company says it has been ordered to pay $2.7bn (£1.68bn) by a Mexican court.

According to a press note on Yahoo today notes that the company has been ordered to pay $2.7bn in a contract dispute by the 49th Civil Court of Mexico City. The non-final judgment was made in favor of Worldwide Directories, a holding company of Ideas Interactivas, against Yahoo in Mexico with regards to yellow pages listings.

Details are pretty scarce about the initial complaint. The reported ruling follows a lawsuit stemming from allegations of breach of contract and lost profits related to a yellow pages listing service. Yahoo has issued the following statement about the ruling:

Yahoo! “believes the plaintiffs’ claims are without merit and will vigorously pursue all appeals”. A Mexican court thumped Yahoo with a huge judgment today, ordering it to pay $2.7 billion to a couple companies accusing it of breaching contract related to a yellow pages listings service.

Evidently, Yahoo’s Mexican subsidiary endorsed a deal in 2003 with Ideas Interactivas and its parent company, Worldwide Directories, to create a yellow-pages site, Paginas Utiles, which would run both in print and online. That website now appears to be defunct.

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Another blow came from one Carlos Bazan-Canabal, who claims on a profile page that he was employed by Yahoo in Mexico in 1999 and 2001. His LinkedIn profile also indicates that he is currently a General Manager and Partner at Alternativo Networks, which has a relationship to Worldwide Directories, the holding company of Ideas Interactivas.

According to a Mexican news report, the first print run of Paginas Utiles was supposed to have a circulation of 800,000 copies.

Nevertheless, this is one more distraction for CEO Marissa Mayer, who is trying to turn the company’s core business around and focus it on doing fewer things. Yahoo’s legacy of global expansion has been an obstacle: Mayer recently shuttered Yahoo’s Korean operations.