Vonage loses patent appeal

Vonage has lost its patent appeal to Verizon and will pay an additional $37.5 million on top of the $80 million Vonage handed over to the telco giant. Vonage has paid out patent settlements to Sprint, AT&T and now Verizon to a tune of $240 million. Vonage had paid Verizon $80 million with an agreement to pay an additional $37.5 million if a federal court declined to hear an appeal. The court Thursday declined Vonage a hearing.

"We were not surprised, but disappointed, that the court denied our request for a rehearing of the case," a Vonage spokesman said. "We are pleased to continue putting litigation behind us and keep focusing on our core business." Vonage is very focused on getting its operations in order so it is not burning cash. It's precariously balanced with liabilities of $729 million compared with assets of $666 million. CFO John Rego told analysts at the Q3 call Vonage would have about $54 million in cash at the end of Q4 which is thin when you have that much debt and every new customer costs over $200. Founder and newly returned CEO Jeffery Citron says dealing with Vonage's debt issues is the company's number one priority.

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