Thursday, April 5, 2007

Vonage Continues Adding Customers Under Emergency Stay of Injunction

A U.S. District Court in Alexandria, Virginia issued an injunction against Vonage effective April 12 that bars Vonage from acquiring new customers during its appeal in its VoIP patent dispute with Verizon.

In response, Vonage filed for and received an emergency stay of the injunction from the Federal Circuit. Vonage said the stay enables it to continue to sign up new customers until the Appellate court can hear Vonage's request for a permanent stay. The Court's ruling also allows Vonage to continue to provide phone service to existing customers.

Vonage said it will continue to provide digital telephone service to existing customers indefinitely by paying into escrow a quarterly royalty of 5.5% throughout the appeals process. Separately, the District Court required Vonage to post a bond of $66 million to secure Verizon's damages judgment.