updated 01:20 pm EDT, Mon October 22, 2007
ATT Suing Vonage
AT&T is joining in the series of lawsuits against Vonage, according to a newly published government filing. The voice-over-Internet provider is now known to have been sued by AT&T on October 17th regarding a patent for connecting a traditional phone to an Internet service; the complaint follows two years of unsuccessful negotiations with Vonage to license the patent, AT&T says. Vonage chief counsel Sharon O'Leary vowed that her company would continue to work for an "amicable" negotiated solution and avoid a court battle.
The lawsuit compounds the legal troubles of Vonage, which has already been sued by Sprint and Verizon, both of which have demanded compensation for other alleged patent violations. While Vonage has successfully obtained a settlement from Sprint and has seen a court void some of Verizon's initial damages, the combination is expected to cost the struggling VoIP service tens of millions of dollars in legal penalties and royalty payments in coming years.
Vonage's difficulties also reflect the challenge of the VoIP phone business to remain profitable as a whole. Former Vonage rival SunRocket shut its doors earlier this year after running low on the finances needed to maintain its business.