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

-- Verizon Patent Case Should be Retried Using High Court's New Standard

for Obviousness --

May 01, 2007, 01:00 ET from Vonage

    HOLMDEL, N.J., May 1 /PRNewswire-FirstCall/ -- 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.