(By Balachander) VirnetX Holding Corp. (NYSEAMEX: VHC) tumbled in Friday trading after the patent-holding company lost a patent infringement suit against Cisco Systems Inc. (NASDAQ: CSCO) over virtual private networking (VPN) technology.
A Jury in the Eastern District of Texas determined that VirnetX patents were not infringed by Cisco.
Zephyr Cove, Nevada-based VirnetX, an Internet security software and technology company, sought $258 million in damages.
The Jury said that asserted claims of VirnetX's '504, '211, and '135 patents are valid over prior art asserted by Cisco.
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"The Court in this case granted a judgment as a matter of law (JMOL) that Cisco failed to prove that VirnetX's '759 patent was invalid," VirnetX said. "While we are disappointed that the Jury did not find infringement in our suit with Cisco, we are pleased that the Jury found our patents to be valid."
The Jury's decision today does not alter the $368 million verdict against Apple Inc. (NASDAQ: AAPL) in November over the same technology. VirnetX reached a $200 million settlement with Microsoft Corp. (NASDAQ: MSFT) in 2010 over networking patents.
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VHC shares fell $2.42 or 9.40 percent to trade at $23.33 at 11.54 am ET on Friday. Cisco shares rose 1.27 percent to trade at $21.86.