Shares of Vringo (NYSEMKT: VRNG) plummeted 36% yesterday, after an unfavorable development in the company's patent infringement lawsuit against Google (NASDAQ:GOOGL), AOL (NYSE: AOL), and other players in search.

Vringo hasn't lost. Heck, closing arguments start today. However, the case's district court judge ruled yesterday to limit any potential damages. Instead of calculating potential damages to as far back as Sept. 15, 2005, only damages from Sep. 15, 2011 will be considered under the equitable doctrine of laches.

Was this enough to shred more than a third of Vringo's value on a whopping 31 million shares of trading volume yesterday?

Vringo still has a shot here, it just won't be collecting as much in past damages as the nine-figure judgment that it was hoping for. There's a reason the court was trying to steer Google and Vringo into an amicable settlement last month.

However, Vringo bulls need to be realistic here. Vringo didn't pay much for Innovate/Protect -- the holding company behind these old Lycos patents that basically detail the ad targeting process -- back in March. If they were worth more than the eight figures that Vringo paid to acquire the patents this year, you can be sure that Google or Microsoft (NASDAQ:MSFT) would've snapped them up to bludgeon its rival.

Again, Vringo still has hope. This is no longer the fringe upstart it was when the year began, carving out a meager living as a smartphone app publisher for a program that generates video ringtones. Any potential payday won't be realized overnight. No matter how this ends, you can be sure that the losing party will vow to fight another day.

However, there's at least less risk in owning Vringo now at less than half of its peak value set just four weeks ago.

This saga is ongoing, and the volatility will continue.

You say you want a revolution

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