Vonage was found to have willfully infringed Sprint's patents in providing its VoIP telephony services by Federal Court jurors in Kansas City. In addition, Vonage was ordered to pay $69.5 million in damages, which the jury found to represent around five percent of Vonage's revenues over the infringing period. Also, Vonage has to pay Sprint Nextel a 5 percent royalty from its future revenues.

"We are disappointed that the jury did not recognize that our technology differs from that of Sprint's patents," said Sharon O'Leary, chief legal officer for Vonage, who vowed to appeal the decision. "Our top priority is to provide high-quality, reliable digital phone service to our customers. Vonage has already demonstrated that it can keep its focus on customers and on its core business while managing ongoing litigation," she added.

Upon the announcement, already-hit Vonage shares took an additional 34 percent plunge. Matters could get even worse for the VoIP company as Sprint announced plans to ask U.S. District Judge John Lungstrum for a permanent injunction against it using the Sprint-patented technology.

Vonage's troubles started in 2005, when Sprint Nextel Corp. sued the company for infringing on seven Sprint patents focusing on connecting and transmitting Internet phone calls. Along the legal battle, Vonage's main counterpoint was that those patents were flawed and shouldn't have been approved.

It's hard to see how Vonage can recover from its current troubles. The company failed to make money from internet telephony, and now it seems practically impossible it will ever make any profit.

"We are extremely pleased with the verdict as it underscores the strength of our voice-over-packet portfolio and reinforces the importance of the innovations developed by our employees," said Harley Ball, Sprint's vice president of IP. "The inventions developed by the late Joseph Christie and other Sprint employees are critical to voice over packet telephony and we view the verdict as validation of the depth of our patent portfolio."

Olga Kharif from BusinessWeek calculated that Vonage has about $184.5 million in cash and equivalents to work with, and assuming Vonage continues to lose money at the current rate of $34 million per quarter, the company can last for a little over five more quarters.