Digital Trends

VoIP operator Vonage can't seem to catch a break: Canadian telecommunications gear maker Nortel has filed suit, saying the company is violating Nortel patents.

VoIP provider Vonage can't seem to catch a break in the intellectual property arena. Attempting to recover from drawn-out litigation battles with AT&T, Sprint, and (most tellingly) Verizon that have withered the company's market value, today Vonage found itself the target of a brand-new patent infringement lawsuit. This one comes from Canadian telecommunications equipment maker Nortel, which is accusing Vonage of violating patents related to VoIP phone services, as well as features like 911 and 411 services and click-to-call features. Nortel is seeking damages and an injunction that would prevent Vonage from using the technology.

Although the suit may be new, the litigation is just the latest move in legal jousting that dates back to 2004. In a move to bolster its intellectual property portfolio, Vonage bought three patents from Digital Packet Licensing back in July of 2006—the same time it got slammed with another patent infringement lawsuit from Klauser Technologies, the same folks now suing Apple and a bunch of other people over visual voicemail systems. However, along with the patents came some legal baggage: in 2004, DPL had sued Nortel, claiming the Canadian company was violating those three patents. Nortel sued back, claiming Vonage is violating 12 of its patents, and Vonage countersued in August of 2007, claiming three of Nortel's patents were invalid and should never have been issued in the first place. Nortel denies the claims, and alleges Vonage is infringing on the three patents Vonage wants invalidated, as well as nine others.

Litigation is expected to be protracted, with additional filings from each side of the case. Both companies can no doubt see the benefit of settling the case before it goes to trial, but the rules of patent litigation pretty much mandate both companies play a game of brinksmanship in order to wrest the best possible deal.