Shares of Vringo (NASDAQ:
), a small technology company which is attempting to generate
revenue through a serious of patent lawsuits, have been all over
the place on Tuesday after the company was awarded $30 million in
damages and granted future royalties in a patent case. The
lawsuit was filed against technology giants including Google
) and AOL (NYSE:
). The stock plunged in early trading all the way down to $3.00
before rallying back to positive.
Once again, in afternoon trading, the stock plunged below
$3.50 before quickly heading back into positive territory. At
last check, the shares were up around two percent to $4.04.
Vringo opened the session at $4.18. It is unclear what has been
driving the series of flash crashes in the name, but they could
be caused by one or two big shareholders selling huge blocks of
stock in short amounts of time. Currently, Vringo only has a
market cap of around $248 million so the actions of some major
holders could have a significant effect on the share price.
In the patent case, a federal jury ruled that the company's
patents were indeed valid, which opens up the possibility of
future lawsuits. Furthermore, Vringo was awarded a 3.5 percent
running royalty rate off a portion of the defendants'
search-advertising revenues until the patents expire in 2016. The
lawsuit alleged that the defendants infringed on two of the
company's patents related to the selection and positioning of
advertising on Internet-search results. Earlier, AOL had settled
a portion of the lawsuit for a mere $100,000.
Last week, Vringo shares plunged 36 percent after a judge
ruled that the company could not be awarded a large chunk of the
past damages it sought because of a long delay in Vringo's filing
of the suit. Overall, the stock has performed extremely well in
2012 for those investors who have withstood the volatility.
Shares are now up nearly 330 percent on the year, but remain off
of their best levels. The 52-week range in Vringo shares is
The stock will likely remain very volatile over the next
couple of days as traders and investors continue to analyze
exactly what today's decision means for the future of the
company. On Tuesday, around 20 million VRNG shares have already
traded hands on the session compared to a 3-month average of
around 7.5 million. This trend of elevated volume and volatility
will likely continue tomorrow and into the end of the week.
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