A Federal court granted Verizon Communications Inc. (NYSE: VZ) a temporary stay on Wednesday, which means the telco doesn't have to start paying millions in royalties to ActiveVideo this week.



The stay comes two days after a district judge denied a similar request from Verizon to stay sunset monthly royalty payments owed to ActiveVideo through May 23, 2012. Verizon could use that time to create workarounds to ActiveVideo patents tied to video on demand (VoD) and interactive TV applications. The earlier permanent injunction requires Verizon to pay ActiveVideo $2.74 per subscriber per month, or about $11 million per month, starting on December 16. (See Judge to Verizon: Pay Royalties to ActiveVideo.)

Counting money linked to the injunction and earlier judgments and awards brought on by Verizon's infringement of ActiveVideo patents, the vendor estimates that Verizon owes it up to $250 million. But Verizon has yet to pay a cent to the vendor, as it lodges its appeal of the original injunction and patent infringement judgements.

The U.S. Court of Appeals for the Federal Circuit issued the stay Wednesday and expedited the briefings cycle, giving ActiveVideo until Dec. 22 and Verizon until Dec. 28 to respond. After that, Verizon's opening brief is due Dec. 29, 2011, with ActiveVideo's due Jan. 26, 2012. Replies to those will be due in February. So, sit tight, because we've still got a ways to go.

ActiveVideo was not immediately available for comment early Wednesday evening.

Why this matters
The temporary stay means Verizon caught a break as it still won't have to pay ActiveVideo royalty payments pending the appeal. In the meantime, Verizon must post a bond with the district court for each ordered payment of sunset royalties that becomes due as long as the motion for a stay remains pending.

For more
Catch up on the case.

— Jeff Baumgartner, Site Editor, Light Reading Cable