Verdict's In: Vonage Owes Verizon Big

Virginia court rules Internet phone service owes Verizon monthly royalties for VoIP technology.

 By Ed Sutherland | Posted Mar 8, 2007
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A Virginia federal jury ruled today that Internet phone service Vonage must pay $58 million plus monthly royalties for infringing three patents owned by Verizon Communications . The decision from the U.S. District Court of Eastern Virginia could permit Verizon to ask that Vonage stop using the disputed technology.

The damages were less than Verizon had asked. Both companies had no immediate comment on the ruling.

The outcome comes just a day after the two companies wrapped up closing arguments for a lawsuit the second-place wireless carrier Verizon began in June. Verizon, which markets its own VoIP service called VoiceWing, argued Vonage infringed on several key patents, including technology connecting Internet-based phone calls with traditional telephone networks.

In closing arguments Wednesday to the Virginia federal jury, Verizon attorney Dan Webb reportedly said the Internet phone company should pay a $4.93 monthly license for each line.

Last month, Vonage CEO David Snyder dismissed the lawsuit as "frivolous" and blasted speculation subscribers will be affected by Verizon's court moves.

"Regardless of how this litigation is ultimately decided, Vonage's customers will see no change whatsoever to any aspect of their phone service," assured Snyder in a statement.

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