AT&T, Vonage finalize patent lawsuit settlement

by Martyn Williams

December 23, 2007 —

A patent infringement lawsuit filed by AT&T against voice-over-IP telephony
provider Vonage has been settled, Vonage said late Friday.

The settlement brings an unusually speedy end to the lawsuit, which was filed
by AT&T on Oct. 17. It alleged Vonage wilfully infringed an AT&T patent
related to telephone systems that allow people to make VOIP (voice-over-Internet
Protocol) calls using standard telephone devices. A breakdown in talks between
the two companies over the issue led to the lawsuit, said AT&T at the time.

Less than a month later, on Nov. 7, the two companies said they had tentatively
agreed to a settlement. At that time Vonage said it would pay AT&T around
US$39 million under the terms of the settlement.

Final terms were not disclosed on Friday when, in a brief statement, Vonage
said the dispute had been settled.

Vonage previously settled a patent suit with Verizon Communications for $80
million to $120 million, depending on the results of its appeal of a court ruling
on two patents, and with Sprint Nextel for $80 million. As part of the Sprint
Nextel deal Vonage agreed to license more than 100 patents covering technology
for connecting calls from a traditional phone network to an IP network. The
Verizon settlement came after a court found Vonage had infringed upon the carrier's
patents.

IDG News Service