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AT&T Slaps Vonage With a Lawsuit

Posted by: Olga Kharif on October 22, 2007

Just when things began looking a little brighter for Vonage, which recently settled a patent infringement lawsuit with Sprint, the Web-calling company got hit with another legal action.

Mighty AT&T filed a patent infringement claim against Vonage in the U.S. District Court of the Western District of Wisconsin. AT&T is seeking injunctive relief, compensatory and treble damages and attorneys’ fees in unspecified amounts. The complaint relates to a single telecommunications patent, and Vonage and AT&T “have been in discussions to resolve this matter for some time. Although the Company intends to continue to pursue an amicable resolution of this matter, the Company cannot assure that this matter will not ultimately be litigated,” per Vonage’s Friday filing.

I remember how, a year ago, when Vonage got hit with a patent lawsuit from Verizon, which it ultimately lost (the case is on appeal), many legal experts claimed that there was no way that Vonage could ever be found guilty of patent infringement. Well, guess what, it’s been found so in two cases already. And now, there comes a third allegation. Will it be the last? Who knows. But one thing is clear: Vonage will have humongous legal expenses for months — if not years — to come. And that’s particularly bad news, considering that the company is already in a poor financial shape. Though Vonage has implemented major cost cuts already, perhaps more will be needed now, in light of the AT&T claim.

Reader Comments

George Ochoa

October 23, 2007 2:30 AM

Of course! any Goliath will feel threat by any little David (Vonage) I hope users will respond with solidarity since it is our only way to keep better prices (more competitive).
Ultimately, keep our choices open, not monopolized!


October 23, 2007 9:19 AM

I really hate this is happening AT&T thinks they can do whatever they want it makes me very angry.
GO VONAGE! I have a personal situation with At&t and they have been terrible to work with even unfair and I am trying to fight the big dog-more like bully and so far I am coming out on the losing end.


October 23, 2007 9:32 AM

I wonder when at&t is going to get hit with anti-trust suits again. They already have a major hold in all four major consumer telecommunications markets and this move proves they are trying to once again dominate the business.

A Moore

October 23, 2007 10:20 AM

If AT&T moves ahead with the lawsuit, I will be left with T-Mobile as my choice for cell phone service. I already do not use standard POTS and will not use any Verizon or Sprint services. I use Vonage for home service and will continue to do so.


October 23, 2007 10:22 AM

Are you crazy? How can you write an article about a lawsuit WITHOUT ACTUALLY SAYING WHAT THE LAWSUIT IS ABOUT.


October 23, 2007 10:28 AM

I thought ATT learned the lesson after pulling the plug on Northpoint users????? It took 10 years before I looked at ATT(cingular) plans again. If they drive my VoIP out of business AGAIN then I will be done with them forever.

June Wilson

October 23, 2007 1:50 PM

AT&T is just plain greedy.


October 23, 2007 5:29 PM

Like most telcos, AT&T felt threatened that a nobody like Vonage could come along and steal so many customers.
I can just imagine what a typical AT&T big wig was thinking: darn those innovative pieces of horse manure offering innovative services at great prices!

It is a very sad sign of our times that AT&T execs do not sit down and think: "hm...why would people want to leave us? What is wrong with our image, services, or prices?"

Jack Davis

November 18, 2007 2:42 PM

I was at one time an AT&T fan, until they messed me up for a "local" dialup number. What AT&T calls a "local dialup" number, were numbers that
were located up to 100 miles away from my location. It seems to me, that as big telecom as they are, they would have a local dial up number in all small towns and cities, where they are located. I went to someone else, and I have never been so pleased as I am now. Come on now AT&T,
wake up before you lose it all.

Mike Pustaver

November 26, 2007 6:13 PM

Way to go AT&T, vonage has been screwing people over. I want to see them go down. The horror stories are true about Vonage and people need to stay away from them.

Scott Valentine

March 9, 2008 4:05 PM

VONAGE SUCKS! You may like them now and you better be a customer for life because when you cancel your gonna get hit with a lot of fees. Just type in Vonage and cancellation in a google search. Vonage is doing horrible right now. GO AT&T

Bill K

February 26, 2009 3:21 PM

VONAGE DOES SUCK! We were not told of cancellation fees and after arguments they closed our account immediately and charged us regardless of a payment plan we worked out, overdrawing our account. We filed a BBB complaint and Vonage would not take our claims seriously nor investigate the deceptive representative who signed us up. I am now looking to get on board with a lawsuit to reclaim my $96.33.

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.



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