Qihoo Executives Don’t Accept Court’s Decision in Latest Legal Loss

Earlier this week, the Guangdong Higher People’s Court ruled in favor of Tencent and against Qihoo in a lawsuit filed over the “3Q War” between the two companies that kicked off in 2010. Qihoo was ordered by the court to pay $800,000 to Tencent and to display a prominent apology to the company on its websites.

If this all sounds familiar, it’s because Qihoo has made something of a habit of losing lawsuits to Tencent, having done so previously twice before. But Qihoo’s executive team remains unbowed, and in the wake of the decision, the 21st Century Business Herald is reporting that several executives including blustery CEO Zhou Hongyi have criticized the ruling.

Their beef revolves around the court’s justification for the decision, namely that Tencent’s QQ instant messaging service isn’t a monopoly because it has strong domestic (Sina Weibo) and international (Facebook, MSN, etc.) competitors. Zhou’s argument is essentially that Sina Weibo is too different to be considered a competitor, and that the international competitors shouldn’t count because they are either too different or too unstable or inaccessible in China to count as competitors.

Qihoo vice-chair Qu Xiaodong added that if QQ and Sina Weibo were similar products, Tencent would not have felt compelled to release its own weibo microblogging platform. Chairmain Ji Xiangdong also shed some new light on the cause of Qihoo’s complaints for the first time, apparently telling reporters that when Tencent forced users to choose between QQ and Qihoo’s 360 Safeguard antivirus software, 20 percent of Qihoo’s users uninstalled the software in a single day. Given Qihoo’s user numbers at the time, that would mean that Qihoo lost 40 million users literally overnight. Damn.

Anyway, it’s hard to imagine what Zhou and company hope to accomplish by criticizing the court’s decision publicly, but if the past is any indication, we can look forward to both companies being embroiled in ugly legal battles for the foreseeable future.

(21st Century Business Herald via Sina Tech)