Mozilla and Yahoo! trade sueballs over Firefox-Google search deal

'Your search is trash and you stopped paying ' vs. 'we had a deal you can't walk away from'

By Simon Sharwood, APAC Editor

Posted in Software, 6th December 2017 07:30 GMT

The Mozilla Foundation and Yahoo! have flung sueballs at each other, after the former ended its deal to have the latter provide search results in the Firefox browser amid claims it hadn't been paid.

Deals with search providers are big money-spinner for Mozilla, bringing in around US$300m a year and contributing around ninety per cent of the foundation's revenue.

In 2014 the organisation ditched Google and picked Yahoo! for a five-year deal.

But in early November, Mozilla terminated that deal and signed with Google.

Yahoo!'s complaint [PDF] was posted by Mozilla and is heavily-redacted, but the gist of it is simple: the companies had a deal, Mozilla welched, and that means Yahoo! “... has suffered and will continue to suffer competitive injury to its business and reputation, among other harm, and Mozilla’s material breaches and bad-faith conduct are a substantial factor in causing such harm.”

Mozilla's posted an explanation of its actions that explained it ended the deal “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.”

“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,” the post by Mozilla chief legal and business officer Denelle Dixon continued. “When it became clear that continuing to use Yahoo as our default search provider would have a negative impact on all of the above, we exercised our contractual right to terminate the agreement and entered into an agreement with another provider.”

The post did not, however, mention a key line in Mozilla's counter-claim [PDF], namely:

In this action, Mozilla seeks injunctive relief to force Yahoo and the company that acquired it earlier this year to make the payments required under the Strategic Agreement.

The counter-claim also suggested that the allegedly missing payments have kicked a hole in Mozilla's budget.

“The payments owed by Yahoo are significant to Mozilla for a number of reasons,” the counter-claim stated at paragraph five. “The payments owed by Yahoo are key to financing Mozilla's efforts to launch the new version of its flagship product, Firefox. Indeed, the parties anticipated that key elements of the negotiated deal to provide stability to Mozilla and to offset the high risk that Mozilla was taking by choosing Yahoo Search as the default search provider.”

But the counter-claim also revealed that payments only ceased after October 31st, 2017.

Also of interest is a section explaining that when Mozilla went to market for a search partner in 2014, it considered Yahoo! a very risky proposition and sought special protections in its contract.

The counter-claim also says management at Oath, Yahoo!'s new owners, did not respond well to suggestions about improving Yahoo!'s search engine in ways Mozilla felt would benefit its own business and browser.

“Yahoo Acquirer's response to Mozilla's concerns was in stark contrast to Yahoo's assurances from CEO Mayer at the time the Strategic Agreement was entered into,” the counter-claim stated. “Yahoo Acquirer's leadership provided no vision, no structured, documented and vetted strategic path forward, and no assurances as to a commitment of the resources necessary to improve Yahoo Search such that it would meet” and then some more redaction cuts in.

The Register has asked Yahoo! and Oath for comment on the suits.

One last thing: the two Yahoo! companies mentioned in both claims are registered in Ireland and Singapore, friendly jurisdictions for multinationals that like to optimise their tax affairs. ®

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