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Siemens Signs An Agreement With VirnetX

|Includes:VirnetX Holding Corporation (VHC)

On January 29. 2013 VirnetX (NYSEMKT:VHC) signed a licensing agreement with Siemens (SI), ending the litigation between the two companies. Siemen's infringement makes up the smallest dollar amount of the companies that VirnetX has targeted, although it further confirms their technology;Siemens signed an agreement because VirnetX's technology and patents are legitimate.

RESTON, Va. and ZEPHYR COVE, Nev., Jan. 29, 2013 /PRNewswire/ - VirnetX Holding Corp. (NYSE MKT: VHC) and Siemens Enterprise Communications GmbH & Co. KG, and Siemens Enterprise Communications Inc., today announced they have signed a Patent License Agreement, which will allow VirnetX to license certain of its patents to Siemens Enterprise Communications, for a one-time payment to VirnetX and an ongoing reasonable royalty for future sales. The agreement will extend through the expiration of the licensed patents with respect to certain current and future IP-encrypted products.

In addition, VirnetX and Siemens Enterprise Communications have agreed to dismiss the patent infringement case brought by VirnetX against Siemens before the U.S. District Court for the Eastern District of Texas.
"We are pleased to have come to an agreement with Siemens Enterprise Communications on terms consistent with our VirnetX IP Licensing program," said Kendall Larsen, VirnetX CEO and President.

Apple (NASDAQ:AAPL) has already been taken to court once, and motions indicate the second trial is on schedule. Moreover Cisco (NASDAQ:CSCO) and Avaya are still up next in court in March; that is if no settlements come first. The deal with Siemens involves a one-time license payment and future royalties. So far Microsoft (NASDAQ:MSFT), NEC, Astra and Mitel have all settled.

Siemens being the smaller player indicates that even the smallest companies have to settle when legitimate patents and technology are infringed upon. VirnetX closer higher on the day with above average volume.

My article on VirnetX v. Apple can be found here

Disclosure: I am long VHC.

Additional disclosure: Always do your own research and make sure an investment is right for you

Stocks: VHC