Vonage Hit With $69.5M Judgement 234
andy1307 writes "The Washington Post is reporting that Net telephone company Vonage Holdings Corp. was ordered in federal court Tuesday to pay Sprint Nextel $69.5 million in damages for infringing on six telecommunications patents owned by competitor Sprint Nextel Corp. In addition to the damages, jurors awarded Sprint Nextel a 5 percent royalty from Vonage on future revenues. It was the second verdict against Vonage this year. A jury in Virginia determined in March that Vonage had violated three Verizon patents in building its Internet phone system. The jury awarded Verizon $58 million in damages plus 5.5 percent royalties on future revenues. Greg Gorbatenko, a telecommunications and media analyst for Jackson Securities, said the decision 'feels like a death knell' for Vonage because future revenue will likely dry up, preventing the company from investing in better technology or improving customer service."
Damn... (Score:5, Insightful)
Seriously, 8 random people who aren't smart enough to get out of jury duty are considered smart enough to understand the fine points of patent law and internet telephony? And this is enough to cripple a (relatively) small startup company? Can someone remind me what Sprint/Nextel did with these oh-so-valuable patents, and what Vonage did that cost them tens of millions of dollars? Besides not paying sprint tens of millions of dollars, that is.
Re:Damn... (Score:4, Insightful)
The most disgusting part of all of this is that the telcos let the little guys take all the risks, prove and market the technology to the public, and show that there is a viable market for VoIP phone service. They they realized that they could squeeze more money out of consumers than Vonage et.al. were, but the only way to do that was put them out of business. I can't help but wonder if this is what our Founding Fathers(TM) had in mind when they envisioned the patent system.
Perhaps the most disheartening thing though, is the question: How many of the violated patents held by Sprint/Verizon are being infringed by the other under the blessing of cross licensing? I'd bet a big bag of money it's greater than zero.
Re:And so, the incumbent telcos smugly feel... (Score:1, Insightful)
That day will only come when the US Government, as we currently know and love it, dissolves because until then, it will be illegal to spit on those that fund our lawmakers pet projects.
Re:Investing in better technology? (Score:4, Insightful)
It is when the only way you can implement it is with the approval of and huge payoffs to the industry oligarchs that currently control telecommunications and who's market VoIP is undermining.
Re:Damn... (Score:5, Insightful)
Interesting contradiction (Score:3, Insightful)
"We are disappointed that the jury did not recognize that our technology differs from that of Sprint's patents," chief legal officer Sharon O'Leary said in a statement.
"Vonage is working on a technology "workaround" to Sprint's patents similar to how it is addressing the Verizon patents."
Why would it be working on work-arounds for patents that it is not infringing?
Re:Absurd (Score:5, Insightful)
In fact, i think we may be seeing that cost all over the friggan place at the moment.
Patents working as the corporations want (Score:4, Insightful)
We've got patents being issued on obvious / unpatentable ideas and they're being upheld by courts that appear to be working for the big corporations - maybe the judges are clueless or overworked, but decisions like this one don't make the legal system look good.
Jointly, the current giant telecom companies hold patents on everything up to and including transmitting a voice over a wire. Any inventor that comes up with a better or cheaper way to provide voice telephony service will receive the same treatment that Vonage did.
Re:And so, the incumbent telcos smugly feel... (Score:2, Insightful)
Pet projects (like the bridge to nowhere, or 50+ Robert Byrd memorial buildings) are paid for by the taxpayer, which the federal gov't has no compunction about spitting upon. If the taxpayers (and voters) didn't hand them unlimited power in exchange for aiding "the poor", "the middle class", "the retired" and "the children", lobbyists and special interests wouldn't receive federal favors.
How times change... (Score:5, Insightful)
Funny how that works.
Re:And so, the incumbent telcos smugly feel... (Score:2, Insightful)
Re:A perfect example of patents destroying innovat (Score:4, Insightful)
Fixed for you.
Sad day for Americans (Score:3, Insightful)
Re:Absurd (Score:3, Insightful)
Vonage isn't in trouble for operating a VOIP service...tons of people do that, the cable company's phone offerings, skype, etc. I have no idea what patents they violated, but it would be a specific method or implementation...not the concept in general.
Dozens of other companies are doing VOIP and they're in the clear, so maybe Vonage just didn't bother to get the licenses necessary or use a different implementation.
Re:Interesting contradiction (Score:4, Insightful)
Re:Absurd (Score:3, Insightful)
Ehh...not really. Juries decide questions of fact. Questions of law are decided by judges. A jury's decision rarely has any sort of precedential effect at all.
Re:Simply another step towards the next bell monop (Score:1, Insightful)
Re:Vonage was just more corporate evil. (Score:3, Insightful)
First rule: Don't use work e-mail for personal bills. Of course, unless they were related....
Re:And so, the incumbent telcos smugly feel... (Score:1, Insightful)
Re:Damn... (Score:2, Insightful)
I can't believe this message was moderated as "Insightful." It's actually ignorance and cynical.
The electoral college only impacts presidential elections, and since the president can be overridden by Congress that are not elected by the electoral college, the political process can be "interfered" with by the common people just fine. And the electoral college, in practice, elects the person that is selected by the people--there are only a few cases of "unfaithful electors" in the electoral college.
Anyone who can honestly read the Constitution and come to the conclusion that it was written to protect the wealthy really needs to take their cynicism down a notch or ten.
Others in this thread are right: The patent system is being abused in ways that were not envisioned by the founding fathers.