SHANGHAI - Yahoo China has won a lawsuit it brought against a local search
engine operator over unfair competition, Yahoo China's owner, Alibaba.com, said
Yahoo corporate headquarters in Sunnyvale, California. The
compnay recently invited the top 25 answer givers on its free online
service "Yahoo Answers" to a ceremony at its headquarters to celebrate the
first anniversary of the service which uses volunteers to answer questions
on any topic sent in by Internet users. [AFP]
Second Intermediate Court ruled that Beijing Sanjiwuxian Internet Technology,
operator of the Qihoo search engine, must stop competing unfairly and compensate
Yahoo China for damages and legal costs, Alibaba said in a statement.
Beijing Sanjiwuxian was also required to make a public announcement
clarifying "incorrect allegations," the statement said, without specifying the
size of any possible damages.
A Beijing Sanjiwuxian spokeswoman said the firm would appeal the verdict.
Yahoo China's suit had claimed that Qihoo's 360safe software prompted users
to uninstall the Yahoo Toolbar by making users believe the toolbar was 'malware'
- software that users download unknowingly and is difficult to remove.
Qihoo is run by Zhou Hongyi, a former Yahoo employee who sold his Internet
search business to U.S.-based Yahoo Inc. in 2003 and had remained with the firm
Yahoo Inc. took a 40 percent stake in Alibaba, folding its own China business
into Alibaba and making a $1 billion payment in exchange.
Zhou left shortly after it was announced last year that Alibaba would take
over Yahoo Inc.'s Chinese operations. He now is chairman for Qihoo, whose
investors include venture capital heavyweights Sequoia Capital and IDG.
Zhou previously took legal action in Beijing alleging defamation against
Both Zhou and Alibaba founder Jack Ma are known in China's Internet world as
highly vocal and opinionated entrepreneurs, each building his company from
scratch to become the business leader in its respective area.
Zhou's company, formerly known as 3721, was virtually synonymous with search
in China when Yahoo bought it in 2003.
He was a highly visible figure before the purchase, and continued to freely
express his views after the deal even as 3721 stumbled under competition from
Google and Baidu, China's current Internet search leader.