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Vonage wins reprieve

Written by Jane Coyle on 16 April 2007

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Vonage has won a last minute reprieve from a federal judge on Friday. Following a patent dispute with Verizon in America, Vonage has managed to stave off closure even though a judge in a lower court had said the company could not add new customers. "We just learned, just now, from our legal counsel that we secured a temporary stay until (the appeals court) can hear our request for a permanent stay of that order", said Vonage spokeswoman Brooke Schulz to Reuters. US District Judge Claude Hilton had limited Vonage to serving its existing customers. He also required Vonage to post a $66 million bond. However, the temporary stay enables Vonage to continue to sign up new customers until the Appellate court can hear Vonage's request for a permanent stay. The Court's ruling allows Vonage to continue to provide phone service to existing customers.

The US District Court in Alexandria, VA, indicated it would enter an injunction against Vonage effective April 12, 2007 in connection with certain Verizon technology on which it was found to be infringing. The Court indicated that Vonage would be barred from acquiring new customers during its appeal to the US Court of Appeals for the Federal Circuit in Washington, DC.

The judge presiding over the original case said that Verizon would suffer irreparable harm if he allowed continued infringement of the VoIP technologies that allow consumers to make calls over the Internet. A jury on March 8 found Vonage had infringed three patents owned by Verizon. The jury said Vonage must pay $58 million plus 5.5% royalties on future sales.

The case continues.

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