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Verizon wins injunction against Vonage over patent battle

Vonage must stop using tech covered by Verizon's patents

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US phone company Vonage has been ordered to stop using technology which a court has ruled violates patents held by mobile phone company Verizon.

Vonage, which operates voice over internet protocol (VOIP) phone systems, recently lost a court battle over the technology, which it said did not violate Verizon's patents.

The judge in the case has now issued a permanent injunction against Vonage, agreeing with Verizon that allowing Vonage to use the technology while paying patent licence fees would have cause its business irreparable harm.

Vonage was ordered earlier this month to pay $58m in damages to Verizon and to agree to pay a 5.5 per cent royalty on future use of the technology pending a decision on the issue of a permanent injunction.

Verizon's case was that Vonage had wilfully violated seven of its patents relating to phone technology and it claimed $197m in damages. The court ruled that Vonage violated three patents, while Verizon had by then scaled back its claim to involve just five.

Vonage was ordered to pay just $58m because the court ruled that the violation was not wilful, which entitles the injured party to triple damages.

The patents involved in the case relate to the connection between Vonage's network and the standard telephone network. Patents relating to billing systems were ruled not to have been violated.

The case, being heard in the Federal District Court for the Eastern District of Virginia, will continue in two weeks' time, when both sides will argue the issue of whether or not the injunction should apply while the parties wait for an appeal to be heard.

The judge in the case said that the injunction would not apply while the parties waited for that hearing in two weeks' time.

"We are pleased the court has decided to issue a permanent injunction to protect Verizon's patented innovations for offering commercial-quality VoIP and Wi-Fi services," said John Thorne, Verizon's senior vice president and deputy general counsel.

Vonage's Sharon O'Leary said in a statement that the company relied on technology which it believed did not belong to Verizon. "[Vonage relied] on open-standard, off-the-shelf technology when developing its service" and argued that court evidence failed to prove otherwise," she said.

Copyright © 2007, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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