Boston Communications Group Inc. suffered yet another legal setback Monday when a federal judge ordered the company to stop providing the prepaid wireless services that account for 70 percent of its revenue.
The U.S. Federal District Court for the District of Massachusetts granted the injunction at the request of Freedom Wireless, which in May was awarded $128 million when an eight-person jury found BCGI’s services infringed on Freedom’s patents. Last week, the judge added $20.1 million in interest to the damages.
The injunction allows BCGI to serve current customers for 90 days, although the company must pay Freedom a 2.5-cent per-minute royalty during that time. BCGI is forbidden to sell the service to new customers.
Shares of BCGI, which provides a platform carriers use to deploy prepaid offerings, have tanked since May’s ruling. The stock, which was up 5 cents to $1.16 in midday trading on the Nasdaq, was nearly $10 a share earlier this year.
Monday’s injunction would apply to more than 3 million prepaid users. BCGI said it plans to appeal the original ruling and has acknowledged that it may be forced into bankruptcy if appeals are unsuccessful.
“Our fight is far from over,” said E.Y. Snowden, president and chief executive officer of BCGI. “We will bring our appeal to the U.S. Court of Appeals for the Federal Circuit, which has nationwide jurisdiction over patent issues and is especially skilled at reviewing complex patent cases, where we hope to prevail.”
