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Summary:

There might be a silver lining (albeit faint) for Vonage, the Holmdel, NJ-based company currently enveloped in clouds of doom. The independent VoIP provider, which lost a patent case to Verizon Communications, today acknowledged that it doesn’t have a way of avoiding infringing on Verizon’s patents. […]

There might be a silver lining (albeit faint) for Vonage, the Holmdel, NJ-based company currently enveloped in clouds of doom. The independent VoIP provider, which lost a patent case to Verizon Communications, today acknowledged that it doesn’t have a way of avoiding infringing on Verizon’s patents.

Now, in a note published to his clients, Tier 1 Research analyst Daniel Berninger (also a guest columnist for GigaOM) argues that the legitimacy of Verizon’s two key ‘name translation’ patents (6,104,711 filed on March 6, 1997; 6,282,574-filed February 24, 2000) are themselves subject to scrutiny.

In his note, Berninger writes that the Verizon patent applications authored by Eric Voit reflect contributions made by VocalTec Communications and were discussed at the VoIP Forum in 1996. Some of VocalTec’s technical claims were also formally published in an independent document in January 1997.

Moreover, the published document included contributions from Cisco Systems, Microsoft, IBM, Nortel, Intel and several other prominent technology companies. (See documents at the end of this report.) Records indicate that Verizon filed for its own patents in March 1997 and February 2000. Beringer’s note goes on to say:

The claims in both patents were anticipated by open standards assembled by the VoIP Forum in 1996 and published in January 1997 with the participation of members from Cisco Systems, Microsoft, IBM, Nortel, Intel, Motorola, Lucent, and Vocaltec Communications, among others.

The work of the VoIP Forum, publication plans, and disclosure requirements were noted in a correspondence between the VoIP Forum and the ITU Telecommunications Standardization Sector.

Verizon filed another patent application (6,298,062) in the same time period that does reference the Kahane-Petrack paper of January 1997.

We have contacted Verizon and seeking their response to the note. We will update the story to reflect their response.

See claims and links to patents.

Footnotes:

1. O. Kahane and S. Petrack, “Call Management Agent System: Requirements, Function, Architecture, and Protocol,” IMTC VoIP Forum, Seattle, Washington, January, 1997, 44 pages. PDF

2. IMTC Voice over IP Forum Technical Committee, “Service Interoperability Implementation Agreement”, January 13, 1997. (PDF)

3. Minutes of the VoIP Forum meeting. (PDF)

  1. Om…let me prepare you for what you’re most likely (not) going to hear from Vonage…

    Due to their high level of complexity (which media-contact type folks as you know virtually never get into)…and; more critically to Vonage; the potential invalidation risks to their patents should their executives go on the record with statements which can–and will–be used against their patents by others; we’re (understandably) likely to hear no more than, “No comment,” or “We are confident of our [IP/patents]…” or “We will vigorously defend our [IP/patents” type responses…

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  2. Steve

    just one thing i would like to clarify is that this has nothing to do with vonage. it is prior art issue with verizon’s patents.

    my instincts tell me that this is going to get quite complicated and ugly.

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  3. Vonage is done for — and their investors know it. FiscalTimes.com has a report on what exactly they’re up to. Essentially, they are done for.

    http://fiscaltimes.com/2007/04/13/vonage-keeps-investors-on-hold/

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  4. Your point is well taken. Geeks often point an accusing finger at “intellectual property” aggregators whose only economic function is raping successful ventures.

    Our mistake is considering these vultures an isolated phenomenon – when our captains of industry have practiced this sort of greedy self-defense for decades.

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  5. In order to make use of the prior art in the Vonage case, the Vonage legal team needs to start reaching out in a public way to the early VoIP users and designers. Recall that Net2Phone was operational in 1996 and by March 2000 Dialpad.com was providing calls from VoIP (using name translation) to the PSTN. DialPad was advertising and operational a mere 2 months after Patent ‘574, the key patent, was filed. In the Katz patent cases, Computer Telephony participated by publicly requesting prior art and “hosting” it. Prior art could be hosted on the Wiki. However, if the Vonage legal team does not take action by focusing on the publicly gathered prior art, then a precedent that does not serve the industry as a whole will be set.

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  6. Ooops–you’re right, Om; thanks.

    Meant to say “Verizon”…and “Verizon” patents.

    Given its criticality, I’d be surprised (shocked, really) if Vonage’s legal team didn’t already search wide and dig deep for ANY prior art with which to attempt to invalidate the Verizon patents…

    …thing is, even if there really is invalidating prior art, such as Daniel believes, it may already be too late to matter.

    And to all those who trash “we’re just looking for small licensing fees” “patent trolls”…I’d like to ask them this:

    Would they rather see such patent holders earn licensing fees from companies like Vonage…than watch competitors like Verizon shut such companies down entirely?

    How do you suppose the Vonage employees would answer the question?

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  7. I was considering exactly the same points that Barlow raised. VoIP has been around in one form or another before Verizon’s patents were filed. I am certainly no IP expert, but this really seems to be both a prior art and painfully obvious. If Verizon does truly have the rights to all VoIP related technology, then it follows that every single company that is operating such a service will either have to pay royalties, or if Verizon wants to be really evil, fold up shop. That makes no sense on a number of levels, beyond that fact that Verizon has waited over a decade to start defending their ‘patents’.

    The entire purpose of the patent system is to allow inventors (of true inventions) to be rewarded for their creativity by getting a time-period to develop and bring to fruition their ideas. This whole debacle is the embodiment of everything that has recently gone wrong with the patent system. Patents are no longer granted on merit but are granted based on how much the applicant can afford to pay for a patent lawyer.

    The patent system is screaming for reform. Poorly granted patents, patent trolls, and all these kinds of egregious events stifle business and hurt the consumer–polar opposites from the goals of the patent system when it was conceived.

    (Incidentally, Om, do you have a figure on how many VoIP companies are currently opperating?)

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  8. Great news if it’s true. While prior art doesn’t necessarily invalidate the patent immediately (only more litigation plus the prior art can do that)… if it’s true this might get them an extended stay of the ruling.

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  9. [...] is imploding. Let’s say for the sake of argument the patent thing is a non-issue and Verizon can’t take Vonage down. Vonage’s biggest problem is Vonage. We’ve [...]

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  10. [...] out, most notably that the patents Verizon was awarded were discussed in public by other companies before they were granted their patents. in a note published to his clients, Tier 1 Research analyst Daniel Berninger (also a guest [...]

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