Long/short equity, event-driven, tech, patents/litigation

The VirnetX Tinderbox

Based on the above factors, the timing might be right to purchase put options on VirnetX (NYSEMKT:VHC) stock, or to take a short position on the stock with call protection.


In a patent litigation case against Apple and Cisco, VirnetX received a judgment against Apple for $368 million for infringement damages up to the date of trial, indicating an implied royalty rate of 0.52% of the accused products. Pre-judgment interest was determined to be $9 million, and post-judgment interest to accrue, compounded quarterly, at the prime rate. Assuming a 3.25% prime rate, the total amount owed to VirnetX should the damages award survive appeal would be about $420 million.

In a separate action, VirnetX received a court...

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