Baidu takes Qihoo 360 to court over search dispute

Chinese search giant is seeking US$16 million in damages from the antivirus software maker which launched its own search engine last year, alleging it stole Web site content and infringed on Internet service protocols.

Baidu says Qihoo 360 stole Web content and infringed on Internet service protocols.

Baidu has initiated legal action against Qihoo 360 which it alleged stole Web site content and infringed on Internet service protocols.

In a report Friday, Shanghai-based newspaper First Financial Daily cited sources who said the Chinese search engine and Qihoo 360 recently commenced a new round of lawsuits at the Beiing First Intermediate People's Court.

Baidu said it incurred 100 million yuan (US$16 million) in damages due to Qihoo's infringement, and accused the antivirus software vendor of violating its legal rights with the launch of  Qihoo's 360 own search engine in the second half of last year . While indexing Baidu's products such as Q&A sites and encyclopedia pages, Qihoo had ignored Baidu's robot exclusion protocol which only allows certain competitors such as Google and MSN to access the site.

Baidu started losing market share when Qihoo entered the search market and responded by blocking access to its products, such that when a user clicked on a Baidu site from Qihoo's search engine, they would be redirected to Baidu's homepage.

Qihoo then fought back by replacing the redirected links with cached page views of the blocked sites. It had argued that access to Baidu products should be allowed as they are essentially Internet resources, in addition to other public content provided on the Web.

In response to the lawsuit, Qihoo said in the report that Baidu restricted fair competition for new market entrants and had therefore, violated China's anti-monopoly laws. The antivirus vendor also denied stealing search results from its rival, adding that it spent seven years developing its own search engine.

According to the First Financial Daily report, both parties last year also separately appealed to China's Ministry of Industry and Beijing Municipal Bureau of Copyright. In August, the ministry urged both companies not to escalate the dispute and called for an end to strategic attacks and underhanded tactics.

When contacted, a Baidu spokesperson confirmed the basic facts of the suit by First Financial Daily are true, and "the court accepting the case against Qihoo 360 and the basis [of unfair competition]." "We allege that they took snapshots and spidered Baidu content in violation of the robots.txt protocol," the spokesperson said.

Last month, Qihoo 360 Technology and Google reportedly were  nearing a partnership likely to start at the beginning of 2013 , while other reports noted the deal might pose a threat to current Chinese search incumbent Baidu.