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Will VirnetX Be Granted An Injunction Against Apple? (Ravicher Report)

|Includes:AAPL, VirnetX Holding Corporation (VHC)

As discussed in my August 2012 article, VirnetX (NYSEMKT:VHC) has a number of patent infringement actions currently pending against Apple (NASDAQ:AAPL) and others. In early November, VirnetX received an extremely favorable jury verdict in one of its suits against Apple. The jury found that 16 different claims from 4 different VirnetX patents were infringed by Apple, that Apple had failed to prove any of those 16 claims were invalid, and that VirnetX had suffered $368M in damages from the infringement.

After the jury verdict, the parties filed various post-trial motions. Unquestionably the most important post-trial motion in my opinion is the one filed by VirnetX for a permanent injunction against Apple. If granted, the injunction would prohibit Apple from continuing to sell any product that infringes any of the 16 claims of VirnetX's four patents. Importantly, the injunction would not be limited to just the specific Apple products accused in the lawsuit and found by the jury to infringe, which include the iPhone, iPhone 3G, iPhone 3GS, iPhone 4, iPod Touch, iPad, and iPad 2, but would also prohibit Apple from selling any other product, current or future, including its newest iOS products like the iPhone 5, that also infringe. Obviously, the issuance of such an injunction could provide VirnetX substantial bargaining leverage to negotiate a very favorable license with Apple.

In this Ravicher Report, I provide my opinion regarding whether I believe the judge will grant VirnetX's motion for a permanent injunction against Apple. I may submit the content of this Ravicher Report, in whole or in part, to the Seeking Alpha editors for publication. Seeking Alpha publishing policies prevent me from submitting content that I had previously made available for free. Thus, if you do not wish to pay for this Ravicher Report, I respect and understand that. If I decide to submit some or all of its content to Seeking Alpha as an article and the Seeking Alpha editors review and approve my article, they will publish it then for free.

Disclosure: I am long VHC.

Additional disclosure: I wrote this instablog myself, and it expresses my own opinions. I am not receiving compensation for it, although I am receiving compensation through sales of the referenced Ravicher Report. I have no business relationship with any company whose stock is mentioned in this article. While I am long VHC as of the publication of this instablog and the referenced Ravicher Report, VHC is, in my opinion, highly volatile, as is the litigation process in which it is involved, and therefore I may change my position in VHC at any moment for any reason or no reason at all. When asked, I have given my opinions about VHC to private parties, sometimes in exchange for a fee, and may continue to do so. I recently contacted representatives of VHC to request copies of various documents filed with the court. None were provided.

Stocks: VHC, AAPL