Seems like Yahoo! Inc. (NASDAQ:YHOO)’s best days are endangered by two Mexican companies who have sued Yahoo along with Baker & McKenzie, law-firm, for avoiding a $2.7 billion judgment given by a Mexico court in 2012.
The two companies filing the lawsuit in New York Federal court include Ideas Interactivas S.A. de C.V. and Worldwide Directories S.A. de C.V. under which both Yahoo! Inc. (NASDAQ:YHOO) and Baker & McKenzie are charged with a conspiracy to “corrupt the appeals process and overturn the judgment,”
A Mexican judge gave the ruling in December 2012 over a contractual dispute between Yahoo and associated Mexican companies over some online search project targeted in Mexico. The associated companies filed a lawsuit in 2011 in a Mexico court citing that Yahoo ended the project prematurely and demanded damage charges.
After the judgement, Yahoo said, “Yahoo! Inc. (NASDAQ: YHOO) today reported that the 49th Civil Court of the Federal District of Mexico City has entered a non-final judgment of U.S. $2.7 billion against Yahoo! Inc. and Yahoo de Mexico, S.A. de C.V. in a lawsuit brought by plaintiffs Worldwide Directories S.A. de C.V. and Ideas Interactivas, S.A. de C.V. Yahoo! believes the plaintiffs’ claims are without merit and will vigorously pursue all appeals. The plaintiffs alleged claims of breach of contract, breach of promise, and lost profits arising from contracts related to a yellow pages listings service.”
The new lawsuit charged Yahoo! Inc. (NASDAQ:YHOO) and its lawyer Baker & McKenzie with manipulating the appellate chief judge with the help of a corrupt Mexican federal judge to reduce the settlement amount to $172,500. The appealing party has provided witness statements including the original trial judge.
This lawsuit is likely to create some legal issues for Yahoo in upcoming years.
This article has been written by Prakash Pandey.