A Mexican court has ordered Yahoo to pay $2.7bn (£1.68bn) in a case related to a yellow pages listing service.
The lawsuit presided over by the 49th Civil Court of the Federal District of Mexico City was brought by Worldwide Directories SA de CV and Ideas Interactivas SA de CV, who claims a breach of contract. The dispute refers to a 2003 deal between Yahoo de Mexico and Ideas Interactivas in which the companies were planning to print a Yellow Pages type listing of business telephone numbers in Mexico.
"The plaintiffs alleged claims of breach of contract, breach of promise, and lost profits arising from contracts related to a yellow pages listings service," Yahoo said in a statement.
Yahoo goes on to say that it "believes the plaintiffs' claims are without merit and will vigorously pursue all appeals".
The news will come as a fresh blow to Yahoo CEO Marissa Mayer who is trying to rebuild the company which has struggled in the face of stiff competition from rivals Google and Facebook.
A former Google executive herself, Mayer took over Yahoo back in July and has since employed former executives from Google and Amazon. Under her leadership, Yahoo's third-quarter earnings have stabilised, with reported sales to the tune of $1.2 billion (£750 million).