A judge has capped Vringo Inc.’s potential recovery in its ongoing patent infringement trial against Google Inc., sending Vringo’s stock price into freefall.
 
Vringo and its lawyers at Dickstein Shapiro sought to calculate damages beginning on September 15, 2005. But on Wednesday, U.S. district judge Raymond Jackson in Norfolk ruled from the bench that Vringo can’t ask for damages prior to September 15, 2011—the day that the company filed its suit. The case went to trial on October 16, and closing arguments are scheduled for Thursday.
 
In his ruling, Jackson adopted a laches defense raised by Google’s lawyers at Quinn Emanuel Urquhart & Sullivan, who argued that Vringo waited too long to sue. The judge’s decision means that, even if the jury hearing the case sides with Vringo, the company won’t be walking away with the $696 million it originally asked for. Vringo has a brief statement on the ruling here. 
 
As we reported here, Vringo’s case imperils Google’s most profitable product, the online advertising system AdWords. Vringo, a publicly traded company, acquired the patents at issue, which relate to generating ads based on internet searches, from former Lycos Inc. chief technology officer Ken Lang. Vringo’s stock price quadrupled in the months leading up to trial, particularly after famed investor James Altucher boldly predicted here that Vringo could walk away with billions. (You can read another overview of the case from Ars Technica here.)
 
In his Wednesday ruling, Jackson ruled that Vringo should have brought suit in 2005, when Google debuted the allegedly infringing technology. According to this article in the Virginian-Pilot newspaper in Norfolk, a lawyer for Vringo asked Jackson to hear more witness testimony before making his laches ruling, but he refused.
 
Closing arguments are scheduled for tomorrow. Google is represented by a team at Quinn Emanuel that includes partners David Bilsker and David Perlson. Jeffrey Sherwood and Kenneth Brothers of Dickstein Shapiro represent Vringo.