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Matias Castro
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UCLA graduate- BA Political Science- Philosophy Minor- Law School student - Intermediate Investor I am a current law student and investor. I have been investing for about 5 years. I began investing in Apple, but over the years began investing in small bios and companies that were under $5 that... More
  • Vringo's Future 8 comments
    Nov 12, 2012 11:56 PM | about stocks: VRNG

    What to like and what to expect

    Vringo has been battling the tech Giant for quite some time. At least it should feel like that if you have been long for the past couple of months. The main reason is that it has been a very emotional ride and it is not quite over yet. However, there are many things to like from the Jury verdict from last week.

    Jury verdict is in and it looks very promising. First, the jury confirmed the validity of the patents and said that Google has infringed on both patents (420 and 664). This is not only great news for this particular case, but for other cases that Vringo might want to start against the likes of Microsoft and Facebook. In addition, the jury has decided that PAST damages should be based on running royalties. Here, the running royalties are to be based on a 3.5% rate. Even though this only applies to past damages, the judge will definitely take this 3.5% rate into consideration when he decides on the ongoing royalties. Judges are VERY SMART PEOPLE. This question for the jury was placed with a very specific purpose. The judge wants to know what the jury believes to be a reasonable running royalty rate so that he could also apply it to future damages.

    Moreover, it is important to understand that the Judge is the person in charge of awarding the damages. The jury's damages are taken into great consideration by the judge. However, if the Judge feels the damages given by the jury are unfair, then he has the ability to award less or more in damages accordingly. This would apply to past damages and foregoing damages as well. For example, there are many people that believe the jury made an error when assigning the damages for Google. If the judge feels there was an error or just feels Vringo should be awarded more in damages there are three ways he could this. First, he could just award more in past damages. Another way the judge could impose his authority to achieve justice is by giving Vringo more in future damages. The third option would be for the judge to give Vringo both more in past damages and give more in future damages.

    In sum, I believe the judge will award Vringo more in past damages. I am not saying that there was a clear mistake from the jury when awarding past damages, but it does seem weird that the other defendants would have to pay 35% compared to 3.5% from Google. Further, I believe the judge will grant future damages based on 3.5% in running royalties until 2016 when the patents are due to expire. Like I mentioned above, judges are very smart people and when the jury does the dirty work for them they usually follow along as long as it seems reasonable. To conclude, the most important fact you should get from this article is that the judge is the man in charge when it comes to awarding damages (meaning he has the final say).

    Disclosure: I am long VRNG.

    Disclosure: I am long VRNG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Additional disclosure: I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Stocks: VRNG
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Comments (8)
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  • Prescient Investment Analysis
    , contributor
    Comments (260) | Send Message
     
    My own thoughts on this may be nearly irrelevant. As I am sure you are aware there is a staggering amount of force at play. However, it is helpful to try to consider the possibilities.

     

    Can you suppose there was a juror, or several of them, having trouble awarding the full amount of damages? If that were true, in order to issue their verdict and resume their day to day lives, perhaps the jury agreed that the awarded amount 'if paid in cash would sufficiently compensate the plaintiff for past damages?' The defense probably wanted to know so?

     

    Somehow Google's damages have been decimated, but until we know why, it just may not be worth it to assert that there has been something other than a deliberate verdict?
    11 Nov 2012, 10:42 PM Reply Like
  • Matias Castro
    , contributor
    Comments (48) | Send Message
     
    Author’s reply » I agree that something is weird about the damages. I just do not want to say that it was an error, but it certainly seems like it to me. However, the Judge is the real player in damages. The important thing is that VRNG got the validation of the patents and that Google is GUILTY! Now we have to wait and see what the judge decides. I am sure it will be very positive news.
    12 Nov 2012, 03:07 AM Reply Like
  • ramenking
    , contributor
    Comments (2) | Send Message
     
    right now vrng is trading at 4.77 on nasdaq real time. google it. whats going on? any ideas?
    12 Nov 2012, 03:06 AM Reply Like
  • Matias Castro
    , contributor
    Comments (48) | Send Message
     
    Author’s reply » It was just a mistake. It was happening with other stocks as well
    12 Nov 2012, 09:55 AM Reply Like
  • onetimershot
    , contributor
    Comments (115) | Send Message
     
    I wouldn't get wrapped about the error on the pps.
    12 Nov 2012, 06:15 AM Reply Like
  • cmanis
    , contributor
    Comments (2) | Send Message
     
    It seems to me investors are always looking for that one big opening to make money, thats why were here right? This case is for all practical purposes over VRNG won and Google lost. So why havent people been buying when they know the price is going up?
    13 Nov 2012, 07:20 AM Reply Like
  • Matias Castro
    , contributor
    Comments (48) | Send Message
     
    Author’s reply » Three reasons. First the judge has not ruled yet so people normally invest once they know for sure what they are going to get. Second, most investors haven't heard of VRNG yet because it has not been given that much attention by the media. But once final verdict is in I believe the stock will go have a few pops. Third Google can appeal (which they will) and even though it does not mean they will win (most likely they will lose) it means it will take longer for VRNG to get their money
    13 Nov 2012, 11:12 AM Reply Like
  • DonaldTrumpsCombover
    , contributor
    Comments (11) | Send Message
     
    i think in five years we'll all be vroogling the outcome of the vringo vs google case to find out what the outcome was.
    13 Nov 2012, 11:30 PM Reply Like
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