Vringo Continues Suing Spree with a Shot at ZTE Corp.

Andrew Klips  |

Investors in video ring tone maker Vringo (VRNG) are starting the day in a buying mood as the company disclosed that it has filed a patent infringement lawsuit against China-based ZTE Corporation. Vringo is alleging that ZTE neglected to license technology that it has been using for a decade and was part of $11 billion in sales last year. Vringo acquired the patents in August from struggling Nokia Corp. (NOK) as part of a deal including more than 500 infrastructure patents valued at $22 million.

Fighting over intellectual property is hot button right now with leaders such as Apple (AAPL) and Google (GOOG) involved in multiple lawsuits arguing over rights to technology used in mobile devices. Vringo is moving front and center in the litigation. Today it said that “The filing of this action in the United Kingdom is an initial step in Vringo’s global licensing and enforcement program in the telecommunications sector.”

Apparently, ZTE just doesn’t seem to mind swiping technology from peers. To kick-off 2012, the company lost $676 million (plus continuing royalties) in an infringement settlement with Ericsson (ERIC).

Last week, shares of Vringo, whose biggest shareholder is Dallas Mavericks owner Mark Cuban at 7.4 percent, surged as news hit that a federal judge said he was not stopping Vringo’s patent infringement lawsuit against Google as requested by the search engine giant. A trial date is set for October 16, but the judge also ordered Google to initiate settlement talks with Vringo before that day arrives. The courts also ordered defendants AOL, Inc. (AOL), IAC/InterActiveCorp. (IACI), Target Corporation (TGT), and Gannett Co., Inc. (GCI) to start settlement talks with Vringo, starting tomorrow.
Looking to pad its coffers during the suing binge, Vringo raised $45 million in a direct offering to five of its institutional investors at $4.35 a share.

Vringo has retained David Cohen as its in-house patent attorney. Cohen used to work for Nokia and gained notoriety by guiding Nokia to victory against Apple that resulted in a $715 million paycheck for Nokia, plus royalties from each iPhone that Apple sells.

Investors will be watching for Vringo and Cohen to continue to sift through technologies in search of more violators of their intellectual property. The suing spree could only just be beginning.

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Companies

Symbol Name Price Change % Volume
AAPL Apple Inc. 186.80 -5.43 -2.82 60,813,338 Trade
DFS.P.B DFS.P.B.CL Alamos Gold Inc.
TGT Target Corporation 83.13 -1.19 -1.41 5,625,549 Trade
VRNG Vringo Inc
ERIC Ericsson 8.48 -0.44 -4.93 7,570,698 Trade
NOK Nokia Corporation Sponsored American Depositary Shares 5.79 -0.06 -1.03 13,078,626 Trade
GOOG Alphabet Inc. 1,043.66 7.61 0.73 1,565,946 Trade
IACI IAC/InterActiveCorp n/a n/a n/a 0 Trade
GCI Gannett Co. Inc. 9.75 0.10 1.04 1,460,326 Trade

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