The U.S. Court of Appeals for the Federal Circuit upheld two patent verdicts against Vonage, from a Virginia jury decision in March, which found Vonage had infringed on three patents held by Verizon. The jury awarded Verizon $58 million in damages and future damages of 5.5% on Vonage revenues during the appeal process. Vonage said it was pleased with the decision to vacate the '880 patent and damages, but "remains confident" it has not infringed on the patent. However, the '880 is considered less significant than the '574 and '711 patents, and a lower court is expected to uphold the $58M in damages due to the 880's limited impact, as previously stated by both Vonage and Verizon. "In the meantime, it's business as usual. We have had our workarounds for the 711 and 574 patents in place for some time and will remain focused on providing a great customer experience," commented Vonage Chief Legal Officer Sharon O'Leary. On Tuesday Vonage lost a patent infringement case against Sprint and was ordered to pay $69.5M in damages. Shares of Vonage plunged 26% to $0.96 on Wednesday, setting new all-time closing and intra-day ($0.89) lows.
Sources: Press release, Associated Press, CNET
Commentary: Vonage Loses Patent Case to Sprint; Shares Tank • Best, Worst Performing Stocks of 2007 • Vonage 2Q Loss Narrows, Tops Estimates, But Subscriber Growth Drops
Stocks/ETFs to watch: VG, VZ, S
Seeking Alpha's news briefs are combined into a pre-market summary called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.