VOIP provider Vonage has lost its chief executive and announced cost-cutting plans, while it awaits a life-or-death legal decision.

Chief executive Michael Snyder has resigned, and the company has announced it will to cut costs by $140 million. Meanwhile, the US Court of Appeals will decide on 24 April, in a legal case that could effectively wind up the company.

Chairman and chief strategist Jeffrey Citron will fill in Snyder who resigned, and also quit the company's board of directors on Wednesday.

The company's $140 million cuts will include $110 million in unnecessary marketing expenses, and will make the company more competitive, Vonage said.

Vonage may soon be able to cut back on customer recruitment costs: on Friday it won a temporary reprieve from a court order prohibiting it from signing up new customers as a result of a patent dispute with Verizon, but that order may be reinstated at the April 24 hearing. Vonage spends $275 on marketing for each new customer signed up, it said.

The VOIP (voice over Internet Protocol) operator also plans to freeze staff recruitment, and to lay off 10 percent of its workforce during the second quarter, cutting costs by a further $20 million.

The company expects to report revenue for the first quarter of $195 million and 322,000 new customers signed up during the quarter. Allowing for departing customers, it expects to report a net gain of 166,000 subscribers. The company has around 2.4 million subscriber lines, bringing it an average monthly revenue per line of $28.17, it said.