Two companies in Mexico which won a surprise $2.7 billion preliminary judgment against Yahoo Inc in a contractual dispute said on Wednesday they may be willing to settle for less money, which could avoid a long legal battle.
The ruling by the 49th Civil Court of the Federal District of Mexico City, which was issued on Friday and perplexed the tech world, involves allegations of breach of contract related to an online yellow pages listings service, according to Yahoo. The lawsuit was filed in November 2011 by Worldwide Directories S.A. de C.V. and Ideas Interactivas S.A. de C.V. against Yahoo and Yahoo de Mexico.
Carlos Bazan-Canabal, who says he is a partner in both firms and is named as their strategic planning director in copies of the court ruling obtained by Reuters, said the plaintiffs were prepared to listen if Yahoo made an offer.
"If we can reach a settlement with an interesting number, we would go for it," Bazan-Canabal told Reuters, adding it could be for less than the preliminary award. "It's up to them." He later told Reuters that before the judgment, the companies had made a settlement offer for less than the sum awarded by the court and Yahoo had rejected it. He did not disclose further details of that offer and stressed that the plaintiffs did not feel the need to press Yahoo for a settlement.
"If there's no intention from Yahoo to get a hold of us and potentially reach a settlement, we will pursue all roads both in Mexico and around the world where we might be entitled to compensation," said Bazan-Canabal, who has been meeting lawyers in the United States this week about the dispute. Bazan-Canabal, who noted there were "less than five" people behind the case against Yahoo, said there were still potential
damages in the suit that had not yet been calculated. "This potentially could go up to over $3.5 billion," said
Bazan-Canabal, a former employee of Yahoo de Mexico. Yahoo believes it has "numerous" grounds to appeal,
including both errors in procedure and in application of law, a person familiar with the matter told Reuters.
Yahoo was dismissive of any suggestion of settling. "We're not going to comment on our legal strategy, beyond the fact that we believe the claims are without merit and will vigorously pursue an appeal," a company spokeswoman said. A JPMorgan analyst said the judgment, if sustained, would cost the company an estimated 40