Vonage Stock Tanks as Company Loses Sprint Suit
A jury in U.S. District Court in Kansas City, Kansas, ruled that Vonage had illegally used Sprint patents relating to connecting Internet phone calls. The jury ruled that Vonage would have to pay Sprint $69.5 million in damages, which was the equivalent of 5% of the revenue it derived during the period in which it used the technology.
More importantly, Vonage runs the risk of an injunction barring it from offering its Internet-based phone service. Because Sprint manages Internet phone traffic as well, an injunction could happen quickly, said Mark Kesslen, the head of the intellectual property group at law firm Lowenstein Sandler PC.
“Vonage is in trouble,” he said, adding that an appeal would stay the injunction.
Vonage, Holmdel, N.J., denies using Sprint’s patents and said it would pursue an appeal of the ruling. “We are disappointed that the jury did not recognize that our technology differs from that of Sprint’s patents,” chief legal officer Sharon O’Leary said in a statement.
Virtual PBX Free Trial