Patent Infringement Reversed VirnetX (VHC) Shares Fall Back to 2009 Levels

Stephen L Kanaval  |

VirnetX (VHC) plummeted after a Texas court ruled on the litigation between the internet security Software Company and Apple (AAPL). The Zephyr Cove, Nevada company saw over 1.35 million in company shares trade hands and the stock’s value shed over 45%, closing at $2.43. The issue with Apple was that the two pending cases had unresolved remand issues regarding damages owed to VHC, and the judge ruled that they now have to file the cases separately rather than consolidate the lawsuit. Shares in VHC have traded as high as $35 per share over recent years and have been a volatile patent play for many investors.

The original lawsuit was over patent infringements dealing with Apple’s Facetime and, as it stands, the new lawsuit will start in late September. "We are disappointed by the Court's decision to vacate its prior ruling on consolidation and ordering the parties to retry the cases as two separate matters," said VirnetX CEO Kendall Larsen in a company statement. Below is a 10 year chart dating back to pre- rally level - this has been a wild ride !!!! The companies current value is around $135m after collecting some cash as a result of the suit. I think there is much more to the story here...

Many analysts doubted the VirnetX could actually collect the awarded sum of $625 million in the original patent-related damages. June was a roller coaster for the stock. First, the stock jumped after the Supreme Court’s new rules on patent cases (patent cases now have to only show a “preponderance of evidence”). Then, on June 20th, the stock fell -17% on speculation that VHC would not be able to collect.

VHC has already won a patent against Apple back in 2012 for Facetime’s violation of four patents. The company was awarded $368 million for those violations. VHC stock shot up in February after that award, but it seems that this money is coming harder to come by.

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