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Why VirnetX Holding Corporation Shares Jumped Today

By Steve Symington - Mar 3, 2014 at 7:51PM

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Is VirnetX's pop meaningful? Or just another movement?

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 VirnetX Holding Corporation ( VHC 1.10% ) jumped more than 10% during Monday's intraday trading after SEC filings revealed a favorable order in the company's pending patent litigation against Apple.

So what: Specifically, a U.S. District Court issued an order awarding VirnetX an ongoing royalty of 0.98% on "adjudicated products and products not colorably different from those adjudicated at trial that incorporate any of the FaceTime or VPN on Demand features found to infringe at trial."

Now what: That could amount to an award in the hundreds of millions -- not unlike the $368 million judgment in late-2012 after jury decided Apple had infringed four VirnetX patents also related to FaceTime.

Of course, VirnetX will inevitably need to work through a lengthy appeals process before any court decisions are truly final, which demonstrates just how difficult it can be for small IP companies to actually cash a check. Even so, while it's hardly the final word, today's decision does represent yet another piece of the long-term puzzle for VirnetX shareholders.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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