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: VirnetX Holding (AMEX: VHC) dropped 11% in intraday trading today after announcing it was awarded a new patent for secure communications technology for the next generation of smartphones.

So what: The new patent bolsters VirnetX's two patent infringement lawsuits against Cisco Systems (Nasdaq: CSCO), Apple (Nasdaq: AAPL), and other companies. Investors have been betting that the company will get royalties on all smartphones made for the incoming generation of 4G cellular networks.

Now what: The stock has had a stunning run since VirnetX updated its patent protection plan in mid-March. But lawsuits can take a long time, and companies such as Cisco and Apple have legal budgets that can put a smaller company out of business. "Buy on the rumor sell on the news" investors appear to be taking profits today.

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Fool contributor Cindy Johnson does not own shares of any company named above. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.