Yahoo 2013 Annual Report Download - page 22

We believe that these parties will continue to take steps such as seeking patent protection to protect these
technologies. In addition, patent holding companies may continue to seek to monetize patents they have
purchased or otherwise obtained. As a result, disputes regarding the ownership of technologies and rights
associated with online businesses are likely to continue to arise in the future. From time to time, parties assert
patent infringement claims against us. Currently, we are engaged in a number of lawsuits regarding patent issues
and have been notified of a number of other potential disputes.
In addition to patent claims, third parties have asserted, and are likely in the future to assert, claims against us
alleging infringement of copyrights, trademark rights, trade secret rights or other proprietary rights, or alleging
unfair competition, violation of federal or state statutes or other claims, including alleged violation of
international statutory and common law. In addition, third parties have made, and may continue to make,
infringement and related claims against us over the display of content or search results triggered by search terms,
including the display of advertising, that include trademark terms.
As we expand our business and develop new technologies, products and services, we may become increasingly
subject to intellectual property infringement and other claims, including those that may arise under international
laws. In the event that there is a determination that we have infringed third-party proprietary rights such as
patents, copyrights, trademark rights, trade secret rights, or other third-party rights such as publicity and privacy
rights, we could incur substantial monetary liability, or be required to enter into costly royalty or licensing
agreements or be prevented from using such rights, which could require us to change our business practices in the
future, hinder us from offering certain features, functionalities, products or services, require us to develop non-
infringing products or technologies, and limit our ability to compete effectively. We may also incur substantial
expenses in defending against third-party claims regardless of the merit of such claims. In addition, many of our
agreements with our customers or Affiliates require us to indemnify them for some types of third-party
intellectual property infringement claims, which could increase our costs in defending such claims and our
damages. Furthermore, such customers and Affiliates may discontinue the use of our products, services, and
technologies either as a result of injunctions or otherwise. The occurrence of any of these results could harm our
brands or have an adverse effect on our business, financial position, operating results, and cash flows.
A variety of new and existing U.S. and foreign government laws and regulations could subject us to claims,
judgments, monetary liabilities and other remedies, and to limitations on our business practices.
We are subject to numerous U.S. and foreign laws and regulations covering a wide variety of subject matters.
New laws and regulations, changes in existing laws and regulations or the interpretation of them, our introduction
of new products, or an extension of our business into new areas, could increase our future compliance costs,
make our products and services less attractive to our users, or cause us to change or limit our business practices.
We may incur substantial expenses to comply with laws and regulations or defend against a claim that we have
not complied with them. Further, any failure on our part to comply with any relevant laws or regulations may
subject us to significant civil or criminal liabilities, penalties, and negative publicity.
The application of existing domestic and international laws and regulations to us relating to issues such as user
privacy and data protection, security, defamation, pricing, advertising, taxation, gambling, sweepstakes,
promotions, billing, real estate, consumer protection, accessibility, content regulation, quality of services, law
enforcement demands, telecommunications, mobile, television, and intellectual property ownership and
infringement in many instances is unclear or unsettled. Further, the application to us or our subsidiaries of
existing laws regulating or requiring licenses for certain businesses of our advertisers can be unclear. U.S. export
control laws and regulations also impose requirements and restrictions on exports to certain nations and persons
and on our business. Internationally, we may also be subject to laws regulating our activities in foreign countries
and to foreign laws and regulations that are inconsistent from country to country.
The Digital Millennium Copyright Act (“DMCA”) is intended, in part, to limit the liability of eligible online
service providers for caching, hosting, listing or linking to, third-party Websites or user content that include
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