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Vonage settles patent case with Sprint

Internet telephony provider agrees to pay Sprint Nextel a total of $80 million to use its voice over Internet Protocol, or VoIP, patents.

Internet telephony provider Vonage said Monday that is has settled its patent dispute with Sprint Nextel.

The two companies have entered into a licensing arrangement that allows Vonage to use patents for voice over Internet Protocol, or VoIP, technology that are held by Sprint.

Vonage has agreed to pay Sprint a total of $80 million, according to the company. This includes $35 million for past use of the license, $40 million for a fully paid future license and $5 million in prepayment for services.

In September, a Kansas jury found that Vonage had infringed six Sprint patents. And it ordered Vonage to pay $69.5 million in damages, plus 5 percent for future damages.

Literally the next day, Vonage lost its appeal in its patent legal battle with Verizon Communications. In March, a jury in Virginia found that Vonage had infringed on three patents. And the court ordered Vonage to pay $58 million in damages.

With this latest settlement, Vonage has at least alleviated some of the legal pressure on the company.

"We believe this deal is good news for Vonage, our customers and our shareholders," Sharon O'Leary, Vonage's general counsel, said in a statement. "It allows us to put this litigation behind us and continue to focus on our core business by removing the uncertainty of legal reviews and long-term court action."