RSSVonage Loses in Verizon Patent Case
By Nate Mook | Published March 8, 2007, 4:05 PM
A federal jury has found that Vonage has infringed on three patents owned by Verizon and ordered the Internet telephony company to pay damages of $58 million, in addition to a 5.5 percent royalty on all future Vonage sales.
The award was far smaller than Verizon's requested amount of $197 million, but potentially more damaging to Vonage's business is whether a permanent injunction will bar it from further use of the technologies. Immediately after the verdict, Verizon requested the injunction, and a hearing has been set for March 23.
Verizon sued Vonage in June 2006, accusing the fledgling VoIP firm of knowingly infringing on seven patents related to functionality such as call forwarding and fraud detection. Vonage said it never knew of the patents and was not approach by Verizon until the lawsuit.
For its part, Vonage called the suit "frivolous" and asserts that Verizon simply wants to put it out of business. Verizon has its own VoIP service, known as VoiceWing. The company launched the offering in 2004, although it has seen slow adoption.
The jury decision that Vonage infringed on three of the patents in question was reached in U.S. District Court for the Eastern District of Virginia after less than a day of deliberations. Although it found against Vonage, it agreed that the company's infringement of the patents was not willful.
Vonage is hardly the only company competing in the nascent VoIP space, although it is one of the largest, which likely led to it becoming the prime target of Verizon. The case was being closely watched throughout the industry, as more such patent cases are expected to follow against smaller firms.
Last week, Vonage promised that a negative outcome in the case would not put the company out of business, although it has not said what impact a permanent injunction could have on its future.
Verizon, formerly Bell Atlantic, has many politicians in their pocket including the judges these politicians appointed to the bench. Do you really expect any court case to rule against Verizon? My guess, however, is that this case will be overturned on appeal at great expense to both parties which will be handed down to consumers. It's also worth noting that their are additional lawsuits pending against Verizon from those claiming that they invented the very technology that Verizon claims Vonage stole from them.
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|Damn, this one really sucks! I mean, they weren't even warned before going to court that they were in violation of Verizon's patents and not even given a chance to resolve the issue.
It's just messed up that companies can be so ruthless for money that they'll get you without a warning!
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|Huh? Did you miss the part in the article (above) where it mentions the initial case being filed in June 2006? You can't bring an IP infringement case to trial without showing proof of due diligence. By that, I mean artifacts that show the parties made every "reasonable" attempt to reconcile their issues before proceeding to court. Without that, judges will throw those cases out immediately.
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|Huh? Did you miss the part in the article (above) where it mentions the initial case being filed in June 2006 and vonage saying it was not approached by Verizon until the lawsuit? Here let me highlight it for you:
"Vonage said it never knew of the patents and was not approach by Verizon until the lawsuit."
Yup...sounds like it was a "reasonable" attempt to reconcile their issues before proceeding to court...no wonder the judge didn't through out that case.
I'm no lawyer, but apparently neither are you.
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|I'm sure I'll get flamed for this, but I actually have had a very good experience with Verizon. No, I don't work for them. No, I don't own any VZN stock either. I was on Intellos, then AllTel and Cingular, finally Verizon. Never going back to the others. I'm sure it's all regional anyway. Nearly everyone I talk to has fairly common views of each carrier with respect to others in their area. That could mean VZ is doing well here, but horribly elsewhere I'm sure. In any case, I hope Vonage can work out a solution without hurting their customers. Nothing sucks worse than signing up for something cool and new, and then get told it's shutting down.
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|I like Vonage too, not a big fan of Verizon they are just overpriced and claim to greatness but their service truly is horrible.
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|Their customer service is horrible!!! But I would pay Verizon 50+ for 30Mbps Down and 5Mbps Up before I'll pay Comcast 55+ a month for 8Mbps Down and 756kbps Up.
Sigh.....I want the old AT&T back.
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|IF the company willingly violated a copywrite,
it must pay for that technology. However, the solution is simple. The sales ratio of VOIP to company such as Verizon is such that soon Vontage will begin outselling the traditional landline. Combined with the merger of ATT & SWBELL this will cause further harm t o verizon. The company I would not put stake in is Verizion. ATT is in the process of changing all services to focus on VOIP. This will continue, and as companies like Verizion start to weaken these events will happen more and more as we watch old companies who fail to move forward wither and die. Others will, LIke ATT re-invent theirselves, buy up smaller VOIP companies who have new technology ideas and force companies who rely on pattons for old technology and "locked in" copywrite to loose market share - CEO ARKANSIS IS (Network telephony intergragion, ATT,HP,IBM & DELL Direct Partner)
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|Everything's ok; no need to look behind that curtain, son.
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|I really hate those annoying Vonage commercials. But, this is retarded. Enough is enough. These patents are out of control. It's almost to the point of people getting a patent for the way someone takes in air. Wait.. I bet there are already some on that very subject.
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|I am suing you for disclosing my air formulation patent.
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|I agree enough is enough but you have to understand one thing, Verizon stands to make more money with a lawsuit than they would with sales its customers’. I read a business article sometime back and it stated that a company patents everything for penny’s and sues for millions. Example, look at the company that is now trying to sue for use of the mp3 format algorithm. They stand to make millions.
Verizon is going way of Comcast, push out the little companies and charge high prices for something that should be half the price and Vonage offers more for a cheaper price. I use both Vonage VoIP and Verizon FiOS.
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|Ouch.
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|"Ouch."
I think that pretty well sums it up...If this does stand Vonage users might want to start looking at the alternatives...
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|I'll do without a phone before I go back to Verizon.
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|same here, I had a verizon rep call me and tell me great deals they can give our business..
Whoopping $25 off any phone we want if we do a 2 year deal.
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|Agreed!
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|?? Is that land line? Because VZ Wireless and VZ landline are two completely separate companies.
I, personally, have never *ever* had problems with Verizon wireless OR wired. I have both and am completely happy.
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