Yahoo 2012 Annual Report Download - page 35

• laws, regulations, licensing requirements, and business practices that favor local competitors or prohibit
foreign ownership or investments;
• different, uncertain or more stringent user protection, content, data protection, privacy, intellectual property
and other laws; and
• risks related to other government regulation, required compliance with local laws or lack of legal precedent.
We are subject to numerous and sometimes conflicting U.S. and foreign laws and regulations which increase our
cost of doing business. Violations of these complex laws and regulations that apply to our international
operations could result in damage awards, fines, criminal actions, sanctions, or penalties against us, our officers
or our employees, prohibitions on the conduct of our business and our ability to offer products and services, and
damage to our reputation. Although we have implemented policies and procedures designed to promote
compliance with these laws, there can be no assurance that our employees, contractors, or agents will not violate
our policies. These risks inherent in our international operations and expansion increase our costs of doing
business internationally and could result in harm to our business, operating results, and financial condition.
We may be subject to legal liability associated with providing online services or content.
We host and provide a wide variety of services and technology products that enable and encourage individuals
and businesses to exchange information; upload or otherwise generate photos, videos, text, and other content;
advertise products and services; conduct business; and engage in various online activities both domestically and
internationally. The law relating to the liability of providers of online services and products for activities of their
users is currently unsettled both within the U.S. and internationally. As a publisher and producer of original
content, we may be subject to claims such as copyright, libel, defamation or improper use of publicity rights, as
well as other infringement claims such as plagiarism. Claims have been threatened and brought against us for
defamation, negligence, breaches of contract, plagiarism, copyright and trademark infringement, unfair
competition, unlawful activity, tort, including personal injury, fraud, or other theories based on the nature and
content of information which we publish or to which we provide links or that may be posted online or generated
by us or by third parties, including our users. In addition, we have been and may again in the future be subject to
domestic or international actions alleging that certain content we have generated or third-party content that we
have made available within our services violates laws in domestic and international jurisdictions. We arrange for
the distribution of third-party advertisements to third-party publishers and advertising networks, and we offer
third-party products, services, or content, such as stock quotes and trading information, under the Yahoo! brand
or via distribution on Yahoo! Properties. We may be subject to claims concerning these products, services, or
content by virtue of our involvement in marketing, branding, broadcasting, or providing access to them, even if
we do not ourselves host, operate, provide, or provide access to these products, services, or content. While our
agreements with respect to these products, services, and content may provide that we will be indemnified against
such liabilities, the ability to receive such indemnification may be disputed, could result in substantial costs to
enforce or defend, and depends on the financial resources of the other party to the agreement, and any amounts
received might not be adequate to cover our liabilities or the costs associated with defense of such proceedings.
Defense of any such actions could be costly and involve significant time and attention of our management and
other resources, may result in monetary liabilities or penalties, and may require us to change our business in an
adverse manner.
It is also possible that if any information provided directly by us contains errors or is otherwise wrongfully
provided to users, third parties could make claims against us. For example, we offer Web-based e-mail services,
which expose us to potential risks, such as liabilities or claims, by our users and third parties, resulting from
unsolicited e-mail, lost or misdirected messages, illegal or fraudulent use of e-mail, alleged violations of policies,
property interests, or privacy protections, including civil or criminal laws, or interruptions or delays in e-mail
service. We may also face purported consumer class actions or state actions relating to our online services,
including our fee-based services (particularly in connection with any decision to discontinue a fee-based service).
In addition, our customers, third parties, or government entities may assert claims or actions against us if our
online services or technologies are used to spread or facilitate malicious or harmful code or applications.
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