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Vonage Reaches Licensing Deal With Sprint Nextel

Vonage Holdings has agreed to pay Sprint Nextel $80 million in a licensing deal that covers past and future use of some 100 patents related to connecting Internet phone calls. Vonage still faces a separate legal battle with Verizon Communications that is considered more serious because the patents at issue play a more fundamental role in Vonage's operations.

A pioneer in offering Internet phone service, Vonage has suffered through a flood of negative press and litigation, which have curtailed customer growth. But even before the problems, the company lost money as it spent heavily on subscriber growth.

The Sprint deal comes two weeks after a jury in the U.S. District Court in Kansas City, Kansas ruled that Vonage illegally used Sprint patents and awarded the communications company $69.5 million in damages. That decision came six months after a separate federal jury ruled that Vonage had illegally used Verizon patents, which dealt with routing Internet calls through traditional phone switches.

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