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Vonage barred from signing up new subscribers (Update: Vonage gets reprieve)


Vonage's oxygen isn't cut off just yet. A federal appeals court granted the embattled VoIP provider a temporary stay of today's ruling barring the company from signing up any new customers. The company will be allowed to continue operations as usual while the Federal Circuit Court of Appeals decides whether or not to grant a permanent stay and review the lower court's decision. Although Vonage will still be able to add new customers, questions about its future are likely to lead many would-be customers to other providers. 苏州美睫美甲

Original story

The judge overseeing the Vonage/Verizon patent lawsuit has just signed off on an injunction that will prevent Vonage from signing up new customers, according to the AP. While the deal was supposed to be a "compromise" that would prevent Vonage from being shut down altogether, the company's lawyers don't see it that way.

"It's the difference of cutting off oxygen as opposed to the bullet in the head," said Roger Warin, who is handling the case for Vonage.

The move does not mean that Vonage's death is inevitable. Although the company is on the hook for $58 million for infringing Verizon patents, Vonage is allowed to use the technology in question if it pays a 5.5 percent licensing fee.

The company has also been inking agreements with other VoIP carriers, though it disputes the theory that Vonage intends to outsource its underlying network to companies without patent encumbrances.

Only a week ago, Vonage's CEO Mike Snyder chastised the market for reacting badly to the initial injunction against his company. "To paraphrase Mark Twain," he said at the time, "the rumors of Vonage's death have been greatly exaggerated."

"The fact is we've been preparing for this verdict and the possibility of an injunction for months," Snyder added. "For the market to react the way it did to the recent rulings shows an unfortunate lack of understanding of the judicial/appellate system, a lack of appreciation of Vonage's resourcefulness, or, perhaps, both. Anyone who's counting Vonage out is making a huge mistake."

The company was expecting today's ruling to go against them, and have already announced plans to file for a stay with the Court of Appeals for the Federal Circuit. They also plan to appeal the entire lawsuit, and senior executives have taken to predicting that the case will assume epic, Jarndyce and Jarndyce proportions.

"No matter what happens on April 6, the reality is this litigation is going to take years to make its way through the legal system," said Sharon O'Leary, Vonage's executive vice president and chief legal officer. "We're very confident the Circuit Court of Appeals will stay the injunction through the entire appeal process. And once the case is up on appeal, we are confident that the appellate court will overturn the verdict based on the faulty claim construction of the patents involved."

The market has largely ignored the upbeat words and the charges of having an "unfortunate lack of understanding." Over the course of the last year, Vonage's stock price resembles nothing so much as my favorite childhood toboggan hill.