How Much Longer Will Patent Trolls Take Their Tolls?
"It's been a weird week for investors with a yen for patent-based business models.
First, video ringtone vendor andoccasional search patent wranglerVringo(NYSEMKT:VRNG) scored a patent infringement victory againstAOL(NYSE:AOL) andGoogle(Nasdaq:GOOG) . But share pricesfellon the verdict because the $30 million up-front damages werefar smallerthan the $493 million the company originally sought. Vringo shares are still down 19% from pre-verdict highs as investors fret over the judge's final say on damages, licensing, and potential injunctions. But the early enthusiasm changes the picture a good deal -- the stock is up 27% from last Friday's closing prices.
Then mobile security expertVirnetX(NYSEMKT:VHC) landed a much larger win againstApple(Nasdaq:AAPL) .Cupertino was ordered to pay VirnetX $370 millionto make up for misuse of the company's patents in the FaceTime video chat app. Sure, investors were hoping for more, but this is still a potential lifesaver for a company with less than $40,000 in trailing revenue. The company recorded a $200 million payment fromMicrosoft(Nasdaq:MSFT) two years ago in a case based on many of the same communication patents, but that windfall never led to any significant license royalties."