Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of wireless security expert VirnetX (AMEX: VHC) jumped as much as 10.9% on above-average volume. That's on top of yesterday's massive-volume 12% bounce to make a very impressive week indeed.

So what: Yesterday, the big news was a bullish analyst note; today, the company was awarded a patent that was promptly used as ammunition in a fresh infringement lawsuit against Apple (Nasdaq: AAPL).

Now what: So the ink is still fresh on that new patent, yet VirnetX claims that Apple "willfully" violated it. Also, the company chose to notify Apple of the violation by launching a lawsuit rather than starting a license negotiation. I don't know about you, but it doesn't sound like any attempt to reach a "fair and reasonable" business arrangement to me.

At the same time, you don't hear anybody talking about VirnetX's legal setbacks, such as the patent office invalidating (link to PDF) the supposedly vital '759 claim. This one-sided conversation is often a sign of impending collapse as investors cheer the good news and never even hear the bad stuff. For examples of this, see Crocs (Nasdaq: CROX) in 2007 and 2008 or SodaStream's (Nasdaq: SODA) much more recent moment of fad fame. Don't let this unbalanced reporting happen to you.

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