IP Telephony news wrap-up for Mar 25 – 2007

The U.S. District Court of the Eastern District of Virginia is preparing to issue a permanent injunction that would bar Vonage from using patented technology owned by Verizon to deliver its VoIP services. U.S District Judge Claude Hilton said he would not sign the injunction for 2 weeks, giving Vonage time to argue its case further. The next hearing on the issue is scheduled for April 6. The initial ruling made in favor of Verizon on March 8th included a $58 million fine plus 5.5% royalties on future sales.

In the meantime, Vonage has requested the injunction be delayed for 120 days. If that request is denied, Vonage will appeal and has also requested that if this is necessary, the court refrain from signing the injunction until the appeal court has ruled. Vonage has said that it is working on developing and deploying a work-around technology that won’t infringe on Verizon’s patents.

The patents relate to the method of switching IP calls to the PSTN, the delivery of calling features such as call forwarding, and VoWiFi. The lawsuit was filed last June.

When the news broke late Friday afternoon, Vonage’s share price quickly dropped more $1, representing more than 25% of its value. To keep it from dipping further, the NYSE halted trading to allow Vonage to release a statement. Since the company’s IPO last year, Vonage’s share price has plummeted a boggling 80%.

Vonage
U.S. District Court of the Eastern District of Virginia
Wiki on Judge Hilton

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