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Vonage Reaches Tentative Settlement With AT&T

Vonage Holdings said Thursday it reached an agreement “in principle” with AT&T to settle the patent-infringement lawsuit the phone company filed, under which Vonage would pay $39 million over five years to AT&T.

In the past month, Vonage has settled similar patent litigation with both Verizon Communications and Sprint Nextel.

Vonage disclosed the settlement discussions with AT&T in announcing third-quarter earnings. AT&T sued Vonage Oct. 17 in the U.S. District Court for the Western District of Wisconsin, alleging the Internet-phone provider infringed on Patent No. 6,487,200, titled “Packet Telephone System.”

Vonage noted that “if negotiations of a definitive settlement agreement [with AT&T] fail, then Vonage intends to vigorously defend itself in this matter.”