Internet phone company Vonage Holding Corp. (NYSE:VG) has substantially completed workarounds in its Internet based telephone systems to begin moving away from technology that violated patents.

The largest voice-over-Internet-protocol (VoIP) service provider said late Thursday that it changed core many core components in its telephony infrastructure to ensure it no longer infringed upon patents held by Verizon.

This is a significant step toward moving ahead with our business in the wake of the Verizon litigation, said Jeffrey Citron, Vonage Chairman.

Shares of Vonage rose 6 cents, or 2.48 percent, to $2.49 in afternoon trading on the New York Stock Exchange.

Verizon sued Vonage in June 2006, accusing the smaller company of violating seven of its patents. The technology related to how Internet calls connect to traditional phone lines.

In March, a federal jury found that Vonage had on infringed three Verizon patents and awarded Verizon $58 million. Vonage has filed an appeal of the jury's decision which ispending.

We look forward to the Court's ultimate decision and remain confident in the strength of our appeal, Citron added.

The company also said it reduced losses from $60 million a year ago to $18 million after implementing cost-saving measures. The Holmdel, N.J.-based company also said it gained 57,000 new subscribers during the quarter. Shares are at $2.37 in morning trading.

I am confident we are taking the appropriate steps for turning our business around, Citron said. I believe we are turning the corner on one of the most difficult periods in Vonage's history. We are close to achieving positive adjusted operating profit.

The beleaguered company said in April that Mike Snyder, former CEO, resigned and the company's founder Jeffrey Citron would take over on an interim basis.

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