With nothing less than the future of Yahoo at stake, lawyers on the Google-Yahoo ad deal understood the gravity of the negotiations.
Brian Pass, from Sheppard’s site |
“With the pressure from Carl Icahn, and the pressure on the board following the termination of the discussions with Microsoft for an acquisition, clearly there was pressure on the Yahoo board to do something,” says Brian Pass, a Sheppard Mullin partner in L.A. who represented Yahoo.
While Skadden represented Yahoo in its battle with Microsoft and does most of the company’s corporate work, Pass had done similar transactions for the company in the past, especially when it came to ad deals. On the other side of the table, representing Google, was Wilson Sonsini partner Suzanne Bell. In house lawyers from both companies were also involved.
“It was very interesting and exciting to be involved,” Bell says.
The 10-year agreement, which outsources some of Yahoo’s advertising to Google, has been given a speculative value of $800 million a year and was essentially Yahoo’s alternative to being swallowed up by Microsoft. The lawyers got started on the deal in April and signed it last Thursday, conducting negotiations at Wilson’s Palo Alto headquarters and Sheppard’s SF office.
Although the deal has already drawn scrutiny from lawmakers over antitrust concerns, both Pass and Bell said the deal was crafted to avoid any trouble with regulators. Wilson’s Susan Creighton will be handling any antitrust issues faced by Google, while Skadden’s Michael Weiner will be doing the same for Yahoo. [Update: A note from Cleary Gottlieb today informs us that firm partners David Gelfand and Leah Brannon also represented Google on the issue, and that the firm has long handled antitrust issues for Cleary.]
We all know why Wilson, which took Google public, was involved in the deal. But you’re probably wondering: With Skadden, Arps the longtime lawyers for Yahoo, how did Sheppard get involved? Pass tells Legal Pad that as a partner at Brown Raysman (since merged with Thelen Reid) he’d done work for Overture — a pioneer in search advertising. Once Overture was acquired by Yahoo in 2003, Pass continued to work for Yahoo on strategic commercial agreements. Pass also said he’s “a true believer,” using Yahoo e-mail and a Yahoo search bar — but, of course now, some of those ads will be from Google.
— Zusha Elinson
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