Yahoo! "bribed" employees to foil Microsoft

It's IT Blogwatch: in which angry shareholders uncover Yahoo!'s poison-pill shenanigans. Not to mention Wally's latest excuse...

Juan Carlos Perez reportz:

Yahoo Inc. has lost a battle to keep information about its operations confidential after a judge decided to unseal documents filed by shareholders suing the company over its handling of Microsoft Corp.'s unsolicited acquisition offer ... The 64-page complaint is full of blistering allegations, copies of internal Yahoo documents and e-mails and blow-by-blow accounts of what plaintiffs characterize as Yahoo's bad-faith maneuvers ... The plaintiffs allege that directors and top managers, including co-founder and CEO Jerry Yang, actively tried to derail Microsoft's efforts to negotiate a mutually beneficial acquisition agreement. The complaint places much of the blame on Yang, describing him as someone with a "well-known" antipathy toward Microsoft ... In particular, the plaintiffs take issue with Yahoo's decision to change employee severance plans. The plaintiffs interpret that as an attempt to scare Microsoft away from the deal. more

Preston Gralla adds:

Yahoo is planning to rush headlong into Google's embrace as a way to avoid a takeover by Microsoft, and claims a Google deal would not violate antitrust laws. But the day before Microsoft made its takeover offer, Yahoo had said a deal with Google might violate antitrust laws. Is truth not part of Yahoo's corporate DNA? ... Yahoo now says the deal won't violate antitrust laws, and doesn't offer any explanation for its about face. The document was released as part of a suit against Yahoo by Michigan pension funds, which wants to force Yahoo to begin talks again with Microsoft. Some other unpleasant facts have also come to light as a result of the suit, notably that Yahoo boosted severance packages for its employees by a whopping $462 million, as a way to make the takeover bid too expensive for Microsoft. Expect other ugly facts to come to light as well. Whenever you start turning over corporate rocks, slimy things tend to escape. more

John Timmer:

Yahoo's hostility towards its purchase by Microsoft didn't only hurt feelings in Redmond. A number of shareholders were hoping for a sale at a significant premium over Yahoo's trading price and, with the collapse of the deal, at least one class-action lawsuit has erupted ... on behalf of various Detroit governmental retirement funds ... The lawsuit is based on the assertion that selling out to Microsoft is in the best interest of shareholders, who would have received a premium share price for a company that's become search's perpetual second-place finisher ... [that] nobody at Yahoo was ever interested in an agreement, and that the firm's leadership did its best to prevent the deal going through. To that end, it paints Jerry Yang and David Filo, who have an emotional attachment to the company they founded, as the worst people to be heading Yahoo's negotiating team. more

John Paczkowski:

Desperate times call for desperate measures. And lest there be any doubt that Yahoo’s (YHOO) exploratory search-outsourcing alliance with Google (GOOG) is just that, consider this: Yahoo opposed such a partnership on Jan. 30–the day before Microsoft (MSFT) announced its bid for the company. According to documents unsealed yesterday as part of a shareholder complaint against Yahoo, the company’s leadership felt an outsourcing deal with Google would be detrimental to Yahoo’s long-term push to become a “must buy” for advertisers ... Sadly, Yahoo forgot to add a very important caveat to this statement: “When you’re not facing a hostile buyout offer from Microsoft.” Because when you are, concerns about long-term value creation and harm to the competitive market apparently cease to be an issue. more

Ashkan Karbasfrooshan goes all meta on us:

I think the 2000s will mark the decade that mainstream media became less important, and taken less seriously. In the first half of the decade, it was American media’s failure to question the Iraq war. That is a matter we will leave for our political blog. The second half of the decade created another challenge for MSM: faced with an onslaught from blogs, competitive pressure on their business, newspapers stopped doing any kind of real investigative journalism and decided to protect the one advantage they have over new media, and that is access. Take business reporters. I have a world of respect for traditional media and journalists, but what this YHOO case demonstrated was that journalists traded in their investigative hats for the coddler role. Go back to 90% of the stuff you would read in WSJ, NYT, etc. etc., and ultimately, I saw a series of writers seeking to show off how great their sources were and not once call out Jerry Yang and the Board for their borderline (if not outright) criminal behavior. more

And finally...

• Dilbert's Wally gets subtle
  

Buffer overflow:

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• SJVN: Good-Bye Mr. Gates
• Preston Gralla: Yahoo's big lie in the Microsoft takeover bid
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Richi Jennings is an independent analyst/adviser/consultant, specializing in blogging, email, and spam. A 21 year, cross-functional IT veteran, he is also an analyst at Ferris Research. You can follow him on Twitter, pretend to be Richi's friend on Facebook, or just use boring old email: blogwatch@richi.co.uk.

Previously in IT Blogwatch:

• Adobe's SaaSy new Acrobat.com
• OOXML oops, protests S. Africa, India, Brazil, and Denmark
• Android amazes and amuses at assembly