If anyone knows the costly price of patent litigation, it's Vonage. The embattled VoIP provider suffered yet another legal blow yesterday as a federal jury ruled that the company had infringed on six Sprint Nextel patents. To settle the issue, the jury ordered Vonage to pony up a whopping $69.5 million in damages -- roughly five percent of the company's revenue over the infringing period.
With the verdict coming down so soon after Vonage's $58 million loss in its patent spat with Verizon, the company's legal team seems to have shifted its focus to damage control after this most recent setback. "We are disappointed that the jury did not recognize that our technology differs from that of Sprint's patents," said Vonage's chief legal officer, Sharon O'Leary in a statement. "Our top priority is to provide high-quality, reliable digital phone service to our customers. Vonage has already demonstrated that it can keep its focus on customers and on its core business while managing ongoing litigation."
Even if O'Leary's spin is taken at face value, it only makes sense that customers and investors would prefer that the company just avoid patent infringement in general, rather than weather the aftermath stoically. The market seems to be in agreement too, as Vonage's stock took a hefty 34 percent dip after news of the verdict Tuesday, and continues to struggle throughout trading today. Like the Verizon patent suit, the company has already stated its intent to appeal, but with the company's slowed customer growth and current stock woes, it's not looking good for the VoIP provider.
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