Judge bars Vonage from using Verizon patents

[Miramonti]

link

Vonage did not expect this, and is at Verizon's mercy in royalty negotiations.

Is it the end of Vonage?

Update

Vonage (VG) shareholders are awaiting another key decision
this afternoon following federal judge's issuance of permanent injunction
barring the Internet phone company from using Verizon's (VZ) patents. This
afternoon's hearing in Virginia will decide if the injunction will be in
place during the appeals process, which could take more than a year.

Update

Vonages response:

Vonage Enjoined; Company Expresses Confidence in Obtaining Stay and in Appeal and Ability to Deliver Uninterrupted Service to Customers
(PR Newswire 03/23 10:17:19)

HOLMDEL, N.J., March 23 /PRNewswire-FirstCall/ -- The U.S. District Court
in Alexandria, Va. today issued an order enjoining Vonage from using certain
VoIP technology named in its patent litigation with Verizon. The order is not
immediately effective, however, and Vonage is confident its customers will see
no change in their phone service.
The court announced its intent to hear stay argument in two weeks' time.
At that time, the court intends to render a decision regarding the stay, as
well as making the injunction effective. If the court denies the stay, Vonage
will seek a stay through appeal from the Federal Court of Appeals. Vonage is
confident it will be able to obtain a stay through appeal.
"We are confident Vonage customers will not experience service
interruptions or other changes as a result of this litigation," said Mike
Snyder, Vonage's chief executive officer.
The company has drafted its notice of appeal of the March 8 jury verdict
and will file that notice at the appropriate juncture in the court
proceedings.
"Our fight is far from over," Snyder said. "We remain confident that
Vonage has not infringed on any of Verizon's patents - a position we will
continue vigorously contending in federal appeals court - and that Vonage will
ultimately prevail in this case."
Snyder continued, "Despite this obvious attempt by Verizon to cripple
Vonage, the litigation will not stop Vonage from continuing to provide quality
VoIP service to our millions of customers."
"Our appeal centers on erroneous patent claim construction, and we remain
confident that Vonage has not infringed on any of Verizon's patents - a
position we will continue to vigorously assert in federal appeals court," said
Sharon O'Leary, Vonage's executive vice president, chief legal officer and
secretary. "Vonage relied on open-standard, off-the-shelf technology when
developing its service. In fact, evidence introduced in court failed to prove
that Vonage relied on Verizon's VoIP technology, and instead showed that in
2003 Verizon began exploring ways to copy Vonage's technology," she added.
The company is focused on growing its business by investing in the rollout
of new technology and features, and continuing to grow its customer base.
Vonage's accomplishments continue to validate its business model and strategy.
The company has achieved 19 consecutive quarters of double-digit revenue
growth, doubled revenues to $607 million in 2006 alone, and added nearly 1
million net subscriber lines last year.

 

[KarmaPolice]

omgwtfbbq pwned

 

[Miramonti]

Ebay management is popping champagne corks right about now (skype).

 

[KLin]

http://uk.reuters.com/article/technologyNews/idUKWAT00719920070323

 

[cjchaps]

Oh crap, what does this mean for current vonage users?

 

[Amused]

A thread on this subject:

http://forums.anandtech.com/messageview...atid=38&threadid=2017653&enterthread=y

 

[Miramonti]

Originally posted by: Amused

A thread on this subject:

http://forums.anandtech.com/messageview...atid=38&threadid=2017653&enterthread=y

Vonage is shell shocked that they were completely barred at this point from using the patents.

 

[preslove]

Our patent system is pathetic. First RIM, now this?

 

[Amused]

Originally posted by: jjsole

Originally posted by: Amused

A thread on this subject:

http://forums.anandtech.com/messageview...atid=38&threadid=2017653&enterthread=y

Vonage is shell shocked that they were completely barred at this point from using the patents.

I know. I just firgured that ifo could have been added to that thread. Hell I could even have updated the OP and title.

 

[NoMoMoney]

Hmmmm... I wonder if they will go after other VOIP providers... does anyone know anything more specific about the patents?

 

[Dirigible]

There will be a quick appeal about the injunction. I'm somewhat surprised at this ruling, as injunctions have been losing favor in the courts.

edited for clarity

 

[Dirigible]

Originally posted by: NoMoMoney
Hmmmm... I wonder if they will go after other VOIP providers... does anyone know anything more specific about the patents?

Yes, they will go after other VOIP providers. They're competition, and Verizon has leverage with their patents.

 

[NL5]

The eight-member jury assessed Vonage $58 million in past damages and ordered it to pay a 5.5 percent royalty rate on Vonage sales going forward.

 

[KarmaPolice]

Originally posted by: NL5

The eight-member jury assessed Vonage $58 million in past damages and ordered it to pay a 5.5 percent royalty rate on Vonage sales going forward.

yeah they didnt say they couldnt use their patents anymore....that would would be too harsh a punishment and then vonage could actually argue that it is against publics interests.

 

[KLin]

Originally posted by: KarmaPolice

Originally posted by: NL5

The eight-member jury assessed Vonage $58 million in past damages and ordered it to pay a 5.5 percent royalty rate on Vonage sales going forward.

yeah they didnt say they couldnt use their patents anymore....that would would be too harsh a punishment and then vonage could actually argue that it is against publics interests.

Read the link in the OP one more time please.

 

[Miramonti]

Originally posted by: Amused

Originally posted by: jjsole

Originally posted by: Amused

A thread on this subject:

http://forums.anandtech.com/messageview...atid=38&threadid=2017653&enterthread=y

Vonage is shell shocked that they were completely barred at this point from using the patents.

I know. I just firgured that ifo could have been added to that thread. Hell I could even have updated the OP and title.

I guess that would made sense. I'm cerebrally impaired at this point tho - while daytrading I bought vonage shares when it sold off...seconds before the halt. This is not going to be pretty when it reopens.

 

[Miramonti]

Maybe they'll be able to get an immediate temporary stay on the ruling in appeals court.

 

[Amused]

Originally posted by: jjsole

Originally posted by: Amused

Originally posted by: jjsole

Originally posted by: Amused

A thread on this subject:

http://forums.anandtech.com/messageview...atid=38&threadid=2017653&enterthread=y

Vonage is shell shocked that they were completely barred at this point from using the patents.

I know. I just firgured that ifo could have been added to that thread. Hell I could even have updated the OP and title.

I guess that would made sense. I'm cerebrally impaired at this point tho - while daytrading I bought vonage shares when it sold off...seconds before the halt. This is not going to be pretty when it reopens.

Bummer.

 

[Miramonti]

Update:

Vonage (VG) shareholders are awaiting another key decision
this afternoon following federal judge's issuance of permanent injunction
barring the Internet phone company from using Verizon's (VZ) patents. This
afternoon's hearing in Virginia will decide if the injunction will be in
place during the appeals process, which could take more than a year.

 

[KK]

I wish callvantage would hurry up and port my number from vonage. I ain't going down with the sinking ship.

 

[tw1164]

Wonder if that's why my wife didn't answer the phone this morning

 

[KarmaPolice]

Originally posted by: tw1164
Wonder if that's why my wife didn't answer the phone this morning

no...

we were busy



*high five*

 

[Miramonti]

Vonages response:

Vonage Enjoined; Company Expresses Confidence in Obtaining Stay and in Appeal and Ability to Deliver Uninterrupted Service to Customers
(PR Newswire 03/23 10:17:19)

HOLMDEL, N.J., March 23 /PRNewswire-FirstCall/ -- The U.S. District Court
in Alexandria, Va. today issued an order enjoining Vonage from using certain
VoIP technology named in its patent litigation with Verizon. The order is not
immediately effective, however, and Vonage is confident its customers will see
no change in their phone service.
The court announced its intent to hear stay argument in two weeks' time.
At that time, the court intends to render a decision regarding the stay, as
well as making the injunction effective. If the court denies the stay, Vonage
will seek a stay through appeal from the Federal Court of Appeals. Vonage is
confident it will be able to obtain a stay through appeal.
"We are confident Vonage customers will not experience service
interruptions or other changes as a result of this litigation," said Mike
Snyder, Vonage's chief executive officer.
The company has drafted its notice of appeal of the March 8 jury verdict
and will file that notice at the appropriate juncture in the court
proceedings.
"Our fight is far from over," Snyder said. "We remain confident that
Vonage has not infringed on any of Verizon's patents - a position we will
continue vigorously contending in federal appeals court - and that Vonage will
ultimately prevail in this case."
Snyder continued, "Despite this obvious attempt by Verizon to cripple
Vonage, the litigation will not stop Vonage from continuing to provide quality
VoIP service to our millions of customers."
"Our appeal centers on erroneous patent claim construction, and we remain
confident that Vonage has not infringed on any of Verizon's patents - a
position we will continue to vigorously assert in federal appeals court," said
Sharon O'Leary, Vonage's executive vice president, chief legal officer and
secretary. "Vonage relied on open-standard, off-the-shelf technology when
developing its service. In fact, evidence introduced in court failed to prove
that Vonage relied on Verizon's VoIP technology, and instead showed that in
2003 Verizon began exploring ways to copy Vonage's technology," she added.
The company is focused on growing its business by investing in the rollout
of new technology and features, and continuing to grow its customer base.
Vonage's accomplishments continue to validate its business model and strategy.
The company has achieved 19 consecutive quarters of double-digit revenue
growth, doubled revenues to $607 million in 2006 alone, and added nearly 1
million net subscriber lines last year.

 

[Goosemaster]

Originally posted by: KarmaPolice

Originally posted by: tw1164
Wonder if that's why my wife didn't answer the phone this morning

no...

we were busy



*high five*

I'm encoding the video right now

 

[funboy6942]

I bet packet 8 will be happy if vonage is no more.
Or is Packet 8 part of this as well since they are like vonage as well?