Standalone VoIP's Long Goodbye Continues

26 September 2007

Vonage may have had a nice summer, but its spring and fall clearly have left much to be desired.

In March, a federal jury found that the company had violated VoIP patents held by Verizon. The award was $58 million and 5.5 percent royalties on future revenues. On Wednesday, the U.S. Court of Appeals in Washington, D.C., upheld the findings on two of the three patents. It sent back the third patent - which involves Wi-Fi technology - for further review. The award of $58 million and 5.5 percent of royalties also is being reviewed, since it was based on the breaching of all three patents.

These days, losing on two of three counts and having the third reconsidered — not reversed — qualifies as the good news for Vonage. The bad news came on Tuesday, when a federal court in Kansas City ordered the company to pay another hefty chunk of change — $69.5 million — for infringement on patents held by Sprint Nextel. The company now is trading for less than $1 per share on the New York Stock Exchange.

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