May 1, 2007 4:03 PM PDT

Vonage requests retrial in Verizon patent dispute

A pivotal U.S. Supreme Court ruling designed to make it easier to challenge obvious patents prompted Vonage on Tuesday to ask for a new trial in an ongoing dispute with Verizon.

One day after the high court released a unanimous opinion widely viewed as one of the most sweeping changes to patent law in years, the struggling Internet phone company asked the U.S. Appeals Court for the Federal Circuit to put its pending appeals process on hold and send the case back to the lower court for a new trial.

Vonage interim CEO Jeffrey Citron voiced confidence that the decision would have "positive implications" for his company's patent battle with the nation's second-largest phone company.

In a statement, Vonage chief legal officer Sharon O'Leary said: "According to the Supreme Court's ruling, if you patent an orange picker, and then someone else comes along and puts a glove on it to protect the oranges against bruising, you can't patent this new invention as 'novel' as it is just an obvious improvement of the original invention. The Supreme Court's decision thus focuses on keeping only what's truly novel and original protected by patents."

In a court motion obtained by CNET, attorneys for Vonage argued that the jury in the original trial was instructed to weigh the validity of Verizon patents based on a test for patent obviousness that the Supreme Court ruled on Monday is too rigid, making it harder to challenge suspect patents. (That case, KSR International v. Teleflex, involved a dispute about patents on gas pedal designs and the extent to which combinations of elements can be patented.)

The jury went on to decide in March that three Verizon patents were valid and had been infringed by Vonage, which carried a damages award of $58 million, plus royalties on future sales.

Because that conclusion was based on what Vonage claims are instructions contrary to the Supreme Court's latest ruling, questions remain about whether the patents at issue are even valid. The motion suggests that the appeals court need not waste its time reviewing the merits of the lower court verdict if validity of the patents remains up in the air and should instead order a new trial.

Verizon deputy general counsel John Thorne dismissed the latest Vonage action and said his company planned to file a brief in response on Wednesday.

"There is no merit to Vonage's motion," he said through a company representative. "It's a delaying tactic to avoid final resolution of the appeal."

Vonage has consistently maintained that its service does not infringe on three Verizon patents in question, which deal with technologies involving connection of voice over Internet Protocol calls to the traditional phone network, some features for implementing call-waiting and voice-mail services, and VoIP calls using Wi-Fi handsets. It has said that it relies on commercial, off-the-shelf technology.

The Federal Circuit has dealt Vonage a reprieve for now, ruling last week that the company can continue to sign up new customers while it appeals a lower court decision. The court simultaneously set a speedier-than-usual schedule for the proceedings, scheduling oral arguments for June 25 and requesting briefs from the parties throughout May.

That timetable will likely make it tough for Vonage to persuade the court to grant its motion, said David Elkins, a patent litigation partner with the law firm Squire, Sanders & Dempsey in Palo Alto, Calif.

"The jury instructions and the manner in which they are impacted by KSR really is a substantive issue that is tightly wrapped within the merits of the appeal itself," Elkins said in a telephone interview. "For that reason, the Federal Circuit is likely to respond, 'we'll look at that in the context of the appeal as a whole'...and that becomes much more likely because the Federal Circuit has set such an unusual expedited appeals schedule."

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Vonage Holdings Corp., patent, Verizon Communications, Internet phone company, court


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If the description is accurate...
If the description here of the Supreme Court's ruling on
obviousness is correct, that should take care of a lot of the
software patents, many of which are trivial improvements on or just
outright ripoffs of common, well-known techniques. In my humble
opinion, of course!
Posted by billmosby (536 comments )
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I hope it does get retried
Who thought that this court would finally get the ball rolling towards axing bogus patents(ie all software patents)?
Posted by MSSlayer (1074 comments )
Reply Link Flag
"software patents" are not the problem
The problem is that too many patents overall are granted
without actually meeting the legal criteria, that is they lack an
inventive step and novelty. Whether those undeserved patents
are about software or not is totally irrelevant -- patent grants
for "inventions" which do not meet the legal criteria are harmful
in any event.

In many cases what geeks perceive to be a software patent is not
considered a software patent under the law. Take codecs for
example. Many DSP techniques used in codecs are patent
encumbered and it does not matter if the codec is then realised
in hardware or software or a hybrid thereof. If a codec uses
patent encumbered DSP techniques then the patents apply -
whether you turn it into a chip or into a piece of software, it
doesn't matter. In fact those patents even apply to software
implementations of such a codec in countries where software
patents are not permissible.

The problem of undeserved patents cannot be solved by riding
on the "software patents are evil" theme. It can only be solved by
actually enforcing existing patent legislation, making sure that
examination is carried out thoroughly enough that undeserved
patents are not granted in the first place. Most people seem to
forget that granting undeserved patents is against the law. The
patent offices may be overwhelmed and understaffed, but they
break the law when they grant patents which do not meet the
legal criteria. This is the root cause of the problem.
Posted by balooh (37 comments )
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