Vonage wins Permanent Stay

Scoring an important win in its ongoing patent battle with Verizon, VoIP provider Vonage on Tuesday won a permanent stay of a previous court’s injunction, meaning simply that Vonage is free to conduct business as usual while it pursues an appeal of the original ruling that found it had infringed some of Verizon’s VoIP patents.

The permanent stay was issued by the U.S. Court of Appeals for the Federal Circuit in Washington D.C., which had earlier granted Vonage a temporary stay so it could argue its case further. Vonage sought the stay after being hit with an injunction by a U.S. District Court in Virginia, which would have kept Vonage from signing up new customers or using the infringed technologies.

As the appeals process winds on, Vonage will put into escrow the 5.5 percent royalty fees (dictated by the original verdict) and will also post a $66 million bond to secure the stay, according to Vonage. Over the past few weeks, several reports of prior art have surfaced, leading many in the VoIP world to question why Verizon was granted its patents, and their validity in such a dispute.

“We are confident this error will be rectified by the appeals court, which hears intellectual property cases exclusively,” said Sharon O’Leary, Vonage’s chief legal officer, in a statement. “As a result, we remain highly confident Vonage will prevail on appeal.”

UPDATE: According to the fine telecom-analyst folks at Stifel, Nicolaus, the court has also set an “expedited schedule” for reviewing the case; in a note sent out Tuesday, Stifel, Nicolaus analysts said the oral arguments in the appeal are set for June 25.