Vonage Files Motion to Vacate and Remand District Court Decision in Light of U.S. Supreme Court's Landmark Patent Decision

HOLMDEL, N.J., May 1, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- Vonage today asked the U.S. Court of Appeals for the Federal Circuit in Washington D.C. to vacate and remand the U.S. District Court's decision finding Vonage infringed on certain Verizon technology. Vonage has asked the appeals court to send the decision back to the lower court to retry the case based on the new test for determining when an invention is too obvious to warrant patent protection. The U.S. Supreme Court unanimously adopted this new test yesterday in the KSR v. Teleflex case.

Vonage praised the high court's decision, which held that the obviousness question should not be determined in a narrow, rigid manner that denies common knowledge, but rather should incorporate a more expansive and flexible approach that allows for consideration of common sense when assessing whether an invention is ordinary or obvious, and thus ineligible for patent protection. Vonage is confident this ruling should have a positive impact on its case. Vonage has consistently maintained it does not infringe on Verizon's technology, asserting in its brief today that the validity of Verizon's name translation ('574 and '711) and wireless ('880) patents should be retried by the U.S. District Court in light of the U.S. Supreme Court's April 30, 2007 decision.

"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 Jeffrey Citron, Vonage chairman and interim chief executive officer. "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."

Borrowing a theme it first began using as part of the "Free to Compete" national grassroots communications campaign launched last week, Vonage described the Supreme Court's decision in consumer-friendly terms.

"Everyone knows you can't patent an orange, but you can - and someone likely already does - hold the patent for an orange picker," said Sharon O'Leary, Vonage's executive vice president, chief legal officer and secretary. "According to the Supreme Court's ruling, if you patent an orange picker, and then someone else comes along and puts a glove on it to protect the oranges against bruising, you can't patent this new invention as "novel" as it is just an obvious improvement of the original invention. The Supreme Court's decision thus focuses on keeping only what's truly novel and original protected by patents.

About Vonage

Vonage (NYSE: VG) is a leading provider of broadband telephone services with 2.4 million subscriber lines. Our award-winning technology enables anyone to make and receive phone calls with a touch tone telephone almost anywhere a broadband Internet connection is available. We offer feature-rich and cost- effective communication services that offer users an experience similar to traditional telephone services.

Our Residential Premium Unlimited and Small Business Unlimited calling plans offer consumers unlimited local and long distance calling, and popular features like call waiting, call forwarding and voicemail -- for one low, flat monthly rate. Vonage's service is sold on the web and through national retailers including Best Buy, Circuit City, Wal-Mart Stores Inc. and Target and is available to customers in the U.S., Canada and the United Kingdom. For more information about Vonage's products and services, please visit http://www.vonage.com.

Vonage Holdings Corp. is headquartered in Holmdel, New Jersey. Vonage(R) is a registered trademark of Vonage Marketing Inc., a subsidiary of Vonage Holdings Corp.

Safe Harbor Statement

This press release contains forward-looking statements regarding Vonage's likelihood of success on appeal. In addition, statements in this press release that are not historical facts or information may be forward-looking statements. The forward-looking statements in this release are based on information available at the time the statements are made and/or management's belief as of that time with respect to future events and involve risks and uncertainties that could cause actual results and outcomes to be materially different. Important factors that could cause such differences include, but are not limited to, our inability to implement an effective workaround, potential claims by creditors, our history of net operating losses and our need for cash to finance our growth; the competition we face; our dependence on our customers' existing broadband connections; differences between our service and traditional phone services, including our 911 service; uncertainties relating to regulation of VoIP services; system disruptions or flaws in our technology; our ability to manage our growth; the risk that VoIP does not gain broader acceptance; and other factors described in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended 12/31/06, and in our subsequent periodic reports filed with the SEC. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, and therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today.