Mozilla files counter suit against Yahoo & Oath

Mindy Sparks
December 7, 2017

In 2014, it had entered into a deal with Mozilla to be the default search engine for five years.

On Tuesday, Mozilla filed a counter-claim in court to force Yahoo to hold up the terms of the deal, and pay up.

The whole dispute started with the release of the newest version of Firefox.

Deals between web browser suppliers and search engine providers are big business.

However, Mozilla claims its actions are in line with the contract that was signed at the time, which includes a clause that stipulates Yahoo must continue to make payments to Mozilla until the contract end date, even if Yahoo is no longer used as the default search engine.This problematic deal was struck by former CEO Marissa Mayer, who, in an attempt to lure Mozilla away from Google, offered the browser provider unprecedented protection in a change-of-control scenario, giving it the right to walk away from the partnership if it did not deem the new partner acceptable. Rather than focus on improving the quality of its search product, as Yahoo assured Mozilla it would prior to entering into the deal, Yahoo continually focused on short-term monetization and special events such as the Olympics and the election, at the expense of product quality.

Mayer's tenure at Yahoo was marred by a series of questionable management decisions that included spending $3 billion on acquisitions and famously paying ad man Henrique de Castro $109 million for 15 months of work. Along with it, Verizon inherited an annual payment of $375 million through 2019.

Recode broke the news of the building battle in mid-2016.


Mozilla did not feel that Verizon was a good match and chose to scrap the deal.

Yahoo Search consistently failed to retain users and search volume over time, reducing the potential revenue [for Mozilla] under the Strategic Agreement.

In response to the lawsuit by Oath, Mozilla stated: "We recently exercised our contractual right to terminate our agreement with Yahoo based on a number of factors including doing what'd best for our brand, our effort to provide quality web search, and the broader content experience for our users".

Numerous specific details of the counter complaints are redacted in their court filings, but Mozilla's Denelle Dixon, chief business and legal officer at Mozilla, said that all it had done was exercise its contractual rights, "based on a number of factors including doing what's best for our brand, our effort to provide quality web search, and the broader content experience for our users", she said. Oath says that Mozilla "terminated a long-term strategic agreement with Yahoo" on November 10.

Mozilla legal head Denelle Dixon continued, "Immediately following Yahoo's acquisition, we undertook a lengthy, multi-month process to seek assurances from Yahoo and its acquirers with respect to those factors". Mozilla was given a contractual right to terminate the agreement, if Yahoo was found unacceptable for some reason.

Mozilla announced that it was dropping Yahoo in favor Google just as it unveiled the Firefox Quantum, a lightning-fast browser that ironically looks to challenge Google Chrome. Still, we are proud of how we conducted our business and product work throughout the relationship, how we handled the termination of the agreement, and we are confident in our legal positions. This has been termed by Mozilla as a breach of contract. Future proceedings should prove interesting.

Other reports by Iphone Fresh

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