Image source: Getty Images
Continue Reading Below
Shares of VirnetX Holding Corp. (NYSEMKT: VHC) were up 34.7% as of 12:30 p.m. EDT Monday after the patent litigation company announced a big legal win in its case against Apple (NASDAQ: AAPL).
VirnetX confirmed that on Friday, Sept. 30, 2016, a jury in the U.S. Court for the Eastern District of Texas, Tyler Division, awarded the company $302.4 million in a verdict against Apple for infringing four VirnetX patents.
More specifically, this verdict covers royalties for Apple's violation of VirnetX's '504 and '211 patents. Or, as VirnetX puts it, "unresolved issues in the Apple I case, remanded back from the United States Court of Appeals for the Federal Circuit," regarding damages owed to VirnetX for infringement by Apple's VPN-on-Demand and alleged infringement by Apple's original FaceTime application.
Continue Reading Below
"We are extremely pleased with the jury verdict announced today," added VirnetX CEO Kendall Larsen. "This is the third time a jury has confirmed that Apple has been using the technology developed by our inventors."
For perspective, recall VirnetX shares plungedin early August after the same U.S. District Court vacated its previous order to consolidate VirnetX's two cases, ordering instead they be retried as separate cases, dubbed Apple I and Apple II. So we're still waiting on the outcome of the Apple II case, which covers alleged infringement, damages, and willfulness of Apple's redesigned versions of both its VPN-on-Demand and FaceTime products in iOS 7 and iOS 8, as well as FaceTime in OS X 10.9 and OS X 10.10 and iMessage.
To that end, VirnetX anticipates a jury trial in the Apple II case to be scheduled shortly after the conclusion of the Apple I case.
We can also be sure, however, that Apple will promptly appeal this decision, drawing out an already lengthy and expensive legal battle that will make it as difficult as possible for a non-practicing entity like VirnetX to actually collect on the judgment. So while this is absolutely an enormous win for VirnetX, I won't be surprised if the company weathers more volatility -- both up and down -- in the days ahead. And I think investors would be wise to take at least some of Monday's quick profits off the table.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here.
Steve Symington owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple. Try any of our Foolish newsletter services free for 30 days. 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.