Marguerite Reardon
http://news.com.com/Vonage+to+pay+58+million+in+Verizon+patent+case/2100-1036_3-6165747
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Internet phone provider Vonage has been ordered to pay $58 million to Verizon Communications for infringing on three of the company's patents.
Vonage, which provides a service that turns broadband connections into phone lines, was found by a Virginia jury to have infringed patents that cover the technology used to connect these VoIP calls to the regular phone network, as well as some features for implementing call-waiting and voice-mail services.
The monetary damages and the ongoing royalties awarded Verizon could have a significant impact on Vonage, if it doesn't come up with a solution that doesn't infringe the patents. The Internet phone service provider has yet to turn a profit.
But the biggest risk for Vonage is that the company could also be forced to shut down its service. In addition to the damages, Verizon is asking the court for an injunction. On March 23, U.S. Judge Claude Hilton will hear arguments to decide whether Vonage's service should stop offering service until an acceptable licensing agreement can be worked out. Vonage said in a press release that it doesn't expect any interruption in service.
"Even though the damages could have been worse, the royalty fees and ongoing legal battle, will add more expenses," Moran said. "And that could impact the future profitability of the company."
http://news.com.com/Vonage+to+pay+58+million+in+Verizon+patent+case/2100-1036_3-6165747
.html?tag=html.alert
Internet phone provider Vonage has been ordered to pay $58 million to Verizon Communications for infringing on three of the company's patents.
Vonage, which provides a service that turns broadband connections into phone lines, was found by a Virginia jury to have infringed patents that cover the technology used to connect these VoIP calls to the regular phone network, as well as some features for implementing call-waiting and voice-mail services.
The monetary damages and the ongoing royalties awarded Verizon could have a significant impact on Vonage, if it doesn't come up with a solution that doesn't infringe the patents. The Internet phone service provider has yet to turn a profit.
But the biggest risk for Vonage is that the company could also be forced to shut down its service. In addition to the damages, Verizon is asking the court for an injunction. On March 23, U.S. Judge Claude Hilton will hear arguments to decide whether Vonage's service should stop offering service until an acceptable licensing agreement can be worked out. Vonage said in a press release that it doesn't expect any interruption in service.
"Even though the damages could have been worse, the royalty fees and ongoing legal battle, will add more expenses," Moran said. "And that could impact the future profitability of the company."
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