Vonage Loses Patent Case to Sprint; Shares Tank

Vonage Holding Co. was found to have knowingly infringed six of Sprint Nextel's patents by a federal jury on Tuesday, and will have to pay Sprint Nextel $69.5 million plus 5% of future revenues. In a press release, Vonage pledged to "vigorously pursue an appeal of the decision, including the underlying issue of liability and the willfulness aspect." The company also said it is developing technology to avoid any potential infringements. Vonage similarly lost a patent case earlier this year against Verizon and was ordered to pay $66 million plus 5.5% in future revenue. Since its IPO last year, Vonage is down 90%. Vonage shares were halted early Tuesday, closing down 7.7% to $1.81.

Sources: Press Release, Bloomberg, Reuters
Commentary: Vonage 2Q Loss Narrows, Tops Estimates, But Subscriber Growth Drops • Vonage Requests Lower Court Retrial, Cites Supreme Court Patent Decision
Stocks/ETFs to watch: VG, S. Competitors: VZ, DT. ETFs: WMH, VOX

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