Judge slams Vonage with service blackout

Patent injunction could shutdown service

23 March 2007 23:59 GMT / By Stuart Miles

Vonage could have its service just down within 2 weeks following a federal judge issuing an injunction barring the VoIP call provider from offering its service because of a patent dispute with Verizon in America.

The blackout could have been immediately, however the judge delayed signing the order for 2 weeks.

Not surprisingly the company's shares fell sharply after the ruling by over 16%.

The 2 weeks will give Vonage time to appeal to the injunction in the hope that the blackout of the service can be avoided.

The judge presiding over the case said that Verizon would suffer irreparable harm if he allowed continued infringement of the VoIP technologies that allow consumers to make calls over the Internet.

A jury on March 8 found Vonage had infringed three patents owned by Verizon. The jury said Vonage must pay $58 million plus 5.5% royalties on future sales.

In response to the outcome Vonage's chief executive officer, Mike Snyder said: "We are confident Vonage customers will not experience service interruptions or other changes as a result of this litigation".

"Our fight is far from over", Snyder said. "We remain confident that Vonage has not infringed on any of Verizon's patents - a position we will continue vigorously contending in federal appeals court - and that Vonage will ultimately prevail in this case."

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