An Illinois-based online stock brokerage is suing Yahoo for negligence in the portal giant's administration of a joint Web site.
The $10 million lawsuit, filed by Web Street Securities, alleged that Yahoo had neglected the maintenance of their cobranded site.
Yahoo would not comment on details surrounding the lawsuit. But spokeswoman Diane Hunt said, "We very strongly believe that [the lawsuit] is without merit and we will defend it vigorously."
Earlier this year, the online brokerage firm agreed to sponsor a mock portfolio contest site on Yahoo's popular finance channel. Yahoo, the company claimed, ignored numerous requests to fix technology glitches that Web Street alleged resulted in faulty data on the site. The company first noticed the glitches when the contest was launched in May, Web Street said.
"We had complaints about people getting on the challenge with wrong positions, and wrong and false rankings," said Jonathan Rosenberg senior vice president of Web Street Securities.
Rosenberg alleged that, because Yahoo failed to honor requests to fix the technology problems, the company received complaints from angry participants, investors, and partners.
"It got to point where we were receiving numerous email complaints, and a number of postings on either site, causing a lot of negative will in the trading community against our company," Rosenberg added. "We felt they were in breach for not standing behind their product."