Yahoo! announced on Thursday that a Mexican appeals court tossed out a $2.7 billion dollar damages award in a breach of contract lawsuit.

"The appellate decision overturned all monetary awards against Yahoo! Inc. and reduced the monetary award against Yahoo! Mexico to $172,500," the California-based Internet pioneer said in a release.

"Yahoo! Mexico was awarded $2.6 million in the original judgment, and this award was confirmed by the appellate decision."

The lawsuit was brought by Worldwide Directories SA de CV and Ideas Interactivas, alleging "breach of contract, breach of promise, and lost profits arising from contracts related to a yellow pages listing service."

In November, the 49th Civil Court of the Federal District of Mexico City "entered a non-final judgment of US $2.7 billion against Yahoo! Inc. and Yahoo de Mexico" in the case, according to the US firm.

Yahoo! contended the claims were "without merit" and appealed to the Superior Court of Justice for the Federal District in Mexico, which sided with Yahoo! and overturned the ruling, the release stated.

Yahoo! did not provide details regarding facts of the case.

Yahoo! shares were up slightly to $26.75 in after-market trades.