By Dave Graham
MEXICO CITY, Dec 5 (Reuters) - A plaintiff in a case against
Yahoo Inc in which a Mexico City civil court made a $2.7
billion preliminary judgment against the U.S. firm said on
Wednesday he and his partners were willing to accept a legal
settlement for less.
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 brought by Worldwide Directories S.A. de
C.V. and Ideas Interactivas S.A. de C.V. against Yahoo and Yahoo
de Mexico, according to Yahoo.
Carlos Bazan-Canabal, who says he is a partner in both firms
and is named as their strategic planning director in copies of
court documents relating to the case 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.
Bazan-Canabal said there were "less than five" people behind
the case against Yahoo.
Yahoo believes it has "numerous" grounds to appeal against
the preliminary judgment, including both errors in procedure and
in application of law, a person familiar with the matter told
Reuters on Monday.
Bazan-Canabal, who operates a host of websites, said he
joined Yahoo in 1999 and later helped to launch Yahoo Mexico.
A Yahoo spokeswoman confirmed he worked for Yahoo Mexico,
but declined to comment further.
Bazan-Canabal said the dispute centered on agreements signed
between Yahoo Mexico and Ideas Interactivas between 2002 and
2004 over a business venture for an online business search
function "Yahoo! Paginas Utiles" as well as printed volumes.
After initial success with the project, the two sides agreed
to extend the model to other parts of the world including Puerto
Rico, Central America, Australia and Japan, but Yahoo later
broke the deal unilaterally, Bazan-Canabal said.
The joint agreement had been due to last until 2009, with
options to extend it further, he added. Breaking the deal caused
Ideas Interactivas to go bankrupt, Bazan-Canabal said.
Worldwide Directories had earlier been set up as a holding
company for Ideas Interactivas, he added.
Any appeal by Yahoo is expected to be heard by a panel of
three judges in a superior court in Mexico City.
Yahoo's most recent 10Q filing, which lists major ongoing
legal proceedings, makes no mention of the lawsuit.
A JPMorgan analyst said the judgment, if sustained, would
cost the company an estimated 40 percent of its 2012 cash
balance, as projected by the bank.
Shares of Yahoo fell 0.2 percent to close at $18.89 on
Nasdaq.
(Additional reporting by Alexei Oreskovic)
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