Mozilla and Yahoo will soon face the courts after Yahoo was replaced the default search engine of Firefox. The whole fiasco started when Mozilla sent a notice to Yahoo on November 10 stating that the "strategic agreement" between the two firms will be terminated immediately. Yahoo first filed a lawsuit against the developers of Firefox on December 1st, after what it considers as sufficient period for Mozilla to reverse its breach of contract. Yahoo detailed how the foundation breached their agreement, although these reasons were redacted from the copy of the lawsuit released to the public. The search company further claims that Mozilla's actions significantly damaged its reputation and business. If Yahoo's lawsuit succeeds, Mozilla will have to pay for the costs of the court case, prejudgment interest, and possible material damages as determined by the court.
On December 5, Mozilla filed a countersuit against the search engine giant, which forces Yahoo to pay its obligations to the foundation as stipulated in its contract. The foundation noted that Yahoo Search failed to meet the specification stated in the contract, and it claims that Yahoo's new owners, Oath, lacks any strategic plan in developing its search business. This is in stark contrast to the statements made by Yahoo's former CEO Marissa Mayer, who considers the search business as a major key growth area for the company. Mozilla also noted that Yahoo's failure to meet the specifications of the contract contributed to the reduction of Firefox's market share. Furthermore, The foundation mentioned that its revenue from Yahoo did not meet expectations although payments continued until October 31, 2017.
The agreement between Mozilla and Yahoo was signed back in 2014 and it was supposed to last throughout the year 2019. According to the terms of the contract, Mozilla will make Yahoo the default search engine of Firefox in exchange for annual payments of $375 million. It has also been reported that the non-profit foundation has the right to terminate the contract once the search engine was acquired by another firm. It is important to note that Yahoo was acquired by Oath, a Verizon subsidiary, earlier this year, and since the acquisition, Mozilla claims that it had repeatedly communicated with the new owners of the search engine giant to ensure that the latter can still fulfill its obligation of providing Firefox users with a quality web search experience. Eventually, Mozilla signed a new deal with Google, making the search engine of the Mountain View-based tech firm as the default option for the browser in the United States, Canada, Taiwan, and Hong Kong. Mozilla promised on its website that more details of the lawsuit will be made available to the public soon.