Vonage Settles Verizon Patent Dispute; Next Up: AT&T

from the cheaper-to-settle-than-to-fight dept

Just a couple weeks ago, we noted that Vonage appeared to be settling all its patent disputes -- with the one exception being Verizon. Well, you can cross that one off the list as well, as Vonage is paying $120 million to Verizon to settle its patent dispute. This is something of a joke. There's been plenty of prior art discovered on Verizon's patents -- and it was quite clear that Vonage didn't take this idea from Verizon at all. In fact, Vonage had been the innovator. The first company that was able to take all of these ideas and package them up in a way that customers actually wanted. Verizon, on the other hand, came to market well after Vonage was already gobbling up marketshare and did a terrible job marketing its product, which failed to generate much interest. So, after losing in the marketplace, Verizon simply sued the company that did a better job. That's not the sort of activity the patent system is designed to encourage. However, Vonage so far had trouble proving its case in court, and it's become clear that Vonage's investors wanted the lawsuits off the decks (perhaps to facilitate a sale), so Vonage is settling as fast as it can. In fact, as soon as news broke that this lawsuit was settled, the stock popped -- so you could say that investors are helping to pay the settlement. Of course, when you're just handing out money for bad patents like that, it should come as little surprise that others are rushing to join the party. Witness AT&T's decision to sue Vonage for patent infringement just last week. Anyone else have a vague, overly broad and obvious patent on VoIP that can be used to squeeze some free money out of Vonage? Now's the time...
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Filed Under: patents
Companies: at&t, verizon, vonage


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  1. identicon
    Chronno S. Trigger, 26 Oct 2007 @ 5:35am

    Re: TechDirt spews more nonsense

    I agree with Mike on this one. If you had read the patent and had any idea how VOIP works, you would to. That is why the patent wasn't invalidated, because no one who had a say knew what the hell they were talking about.

    Verizon sued for a patent that covered the entirety of Vonage. That is to say, Vonage would be literally nothing without that technology covered in Verizon's patent. AT&T and Sprint are suing for patent infringement as well. Even if Vonage is infringing with only a small peace of technology, AT&T and Sprint are infringing on Verizon's patent because Verizon's patent covers everything Vonage douse. How is that not obvious to you?

    If Vonage settled with Verizon, douse this mean they have to pay licensing? I got Vonage to not pay Verizon. It's like buying a CD from an indie artist just to find out that the money is still going to the RIAA. It's F***ing wrong.

    PS: Someone please point me to Sprint and AT$T's patent that Vonage is infringing on so I can see it for myself.

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