Article: Ruling cuts off Vonage recruiting.

Byline: Jon Van

CHICAGO _ Vonage Holdings Corp. dodged a bullet Friday, but was left gasping for air after a federal judge ruled it can continue operating but cannot recruit new customers during its patent dispute with Verizon Communications Inc.

The Internet phone service pioneer, which has 2.2 million customers but continues to lose money, has bet its future on increasing its customer base. If Vonage's appeal of Friday's ruling fails, the firm must either find alternative technology or pull a legal rabbit out of a hat, analysts said.

Rather than a patent dispute, the Vonage-Verizon saga has become a David-Goliath struggle, and one that Goliath is winning.

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