Update

The Court of Appeals has refused Vonage's request for a new trial but has ruled that the VoIP provider can bring up the recent KSR v. Teleflex ruling as part of its appeal of the jury's finding of patent infringement. "Although we're disappointed that the appeals court denied our request for a retrial, this ruling has no impact on our appeal, which continues to move forward," said a Vonage spokesperson.

Original story

Following Monday's Supreme Court ruling in KSR v. Teleflex, VoIP provider Vonage has asked the US Court of Appeals for the Federal Circuit to vacate a lower court judgment that it infringed on three Verizon patents. Vonage is asking for a retrial of the case that will take into account the Supreme Court's latest guidance on patent obviousness.

Ars recently looked at the three Verizon patents and we weren't terribly impressed. From Tim Lee's article:

In short, the "invention" described in these patents is combination of an excruciatingly obvious point—that it would be helpful for an Internet telephony application to have a mechanism for translating between phone numbers and IP addresses—and a series of "enhancements" to DNS servers that many network engineers would regard as a step backwards.

The key here is "excruciatingly obvious." That's exactly what the Supreme Court faulted the Court of Appeals for the Federal Circuit in KSR v. Telefex. Writing for a unanimous court, Justice Anthony Kennedy ruled that "The results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise, patents might stifle rather than promote the progress of useful arts."

Vonage is hopeful that the Supreme Court's ruling will help its case. "We are very encouraged by the Supreme Court's decision and the giant step it represents towards achieving much-needed patent reform in this country," said Vonage interim CEO Jeffrey Citron. "The Supreme Court's decision should have positive implications for Vonage and our pending patent litigation with Verizon. We are also hopeful that this case will protect legitimate innovators and the value of their inventions, unlock the innovation process, and provide that companies are better able to conduct business without the encumbrance of meritless patent claims."

Verizon disagrees with Vonage's take on the ruling. A Verizon spokesperson said that the company believes that there is "no merit" to Vonage's latest filing, saying that the particulars of the KSR v. Teleflex case were "entirely different" than Verizon v. Vonage. The telecom has already filed a reply opposing Vonage's motion.

Vonage's very survival is riding on its ability to convince the Court of Appeals that the lower court erred in its $58 million award. The trial judge also issued an injunction barring Vonage from signing up new customers, but the Court of Appeals has issued a permanent stay of that order pending the outcome of the appeal.