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Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 

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United States Court of Appeals 

for the Federal Circuit ______________________ 

ASIA VITAL COMPONENTS CO., LTD.,

Plaintiff-Appellant

v.

ASETEK DANMARK A/S,

Defendant-Appellee

______________________ 

2015-1597

______________________ 

Appeal from the United States District Court for the 

Eastern District of Virginia in No. 1:14-cv-01293-LO-TCB, 

Judge Liam O'Grady.

______________________ 

Decided: September 8, 2016

______________________ 

ANDREW C. AITKEN, Aitken Law Offices, Wheaton, 

MD, and CAMERON H. TOUSI, IP Law Leaders PLLC, 

Washington, DC, argued for plaintiff-appellant. Also 

represented by RAYMOND HO.

ROBERT F. MCCAULEY, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Palo Alto, CA, argued for 

defendant-appellee. Also represented by C. BRANDON 

RASH, Washington, DC.

______________________ 

Case: 15-1597 Document: 48-2 Page: 1 Filed: 09/08/2016
2 ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S

Before PROST, Chief Judge, LINN and TARANTO, Circuit 

Judges.

PROST, Chief Judge. 

Asia Vital Components Co., Ltd. (“AVC”) filed a declaratory judgment action against Asetek Danmark A/S 

(“Asetek”) seeking a declaration that AVC did not infringe 

U.S. Patent Nos. 8,240,362 (“’362 patent”) and 8,245,764 

(“’764 patent”) (collectively, “the asserted patents”) and 

that those patents are invalid. The United States District 

Court for the Eastern District of Virginia dismissed the 

case for lack of subject matter jurisdiction, concluding

that AVC’s complaint did not plead sufficient facts to 

show that there is a substantial controversy between the 

parties. For the reasons stated below, we reverse the 

district court’s ruling and remand for further proceedings. 

BACKGROUND

AVC is a Taiwanese corporation that manufactures 

cooling systems for integrated circuits. Asetek is the 

assignee of the ’362 and ’764 patents, which are generally 

directed toward liquid cooling systems that are used in 

connection with computers to cool integrated circuits. 

Beginning in 2012, Asetek brought lawsuits against 

other competitors that make and sell liquid cooling systems, alleging infringement of the ’362 and ’764 patents. 

In April 2014, Asetek sent AVC a letter accusing AVC of 

infringing the ’362 and ’764 patents. That letter, however, was based on Asetek’s mistaken belief that AVC 

manufactured a particular product, the Liqmax 120s. In 

the letter, Asetek specifically referenced the Liqmax 120s 

product and provided an exemplary infringement claim 

chart for that product. 

In response, AVC told Asetek that it did not manufacture the Liqmax 120s. Nonetheless, AVC requested a 

meeting with Asetek “to discuss various related matters,” 

Case: 15-1597 Document: 48-2 Page: 2 Filed: 09/08/2016
ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S 3

which AVC considered “of importance concerning future 

cooperation” with Asetek. J.A. 105. Asetek responded in 

an email dated August 2, 2014, that if AVC was not 

making the Liqmax 120s then there did not appear to be a 

reason to meet. Also in the email, Asetek referenced the 

fact that it had tried to cooperate with AVC previously 

“and the experience went very poorly and sowed distrust 

in Asetek for AVC.” J.A. 207. Asetek further noted that 

it does not license its patents and said that “although that 

option may have previously been available to AVC when 

it was manufacturing Asetek’s products, that option is no 

longer available to AVC (based in large part on AVC’s 

prior behavior toward Asetek).” Id. Finally, Asetek 

stated, 

Please be advised that Asetek believes that AVC 

is likely selling other infringing products in the 

United States. We are sure you are aware that 

Asetek enforced its IP, as it has in pending litigations against CoolIT and Cooler Master. Asetek 

has also been allowed a patent in the European 

Union with claims similar to the US ’362 and ’764 

patents, with priority in 2003, and also has similar claims pending in China. 

Id. 

A meeting did ultimately take place between AVC and 

Asetek in August 2014. At the meeting, AVC expressed a 

desire to license the asserted patents, and Asetek initially 

declined. After further discussion, Asetek did offer AVC a 

license at a royalty rate of 16% or at a reduced rate if 

AVC would provide preferential pricing on components. 

AVC representatives at the meeting said they would 

consider that possibility and bring it to the attention of 

AVC management. There was no specific discussion of

AVC products potentially infringing the asserted patents 

at the meeting. 

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4 ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S

On September 30, 2014, AVC filed a complaint 

against Asetek alleging that AVC had designed and built 

liquid cooling products, identified as the K7 and K9 

products, and seeking a declaration that its products did 

not infringe the ’362 and ’764 patents and that those 

patents are invalid. AVC contends that it had completed 

prototype products of the K7 and K9 products and that 

those products have a number of similarities to the CoolIT 

and Cooler Master products that Asetek did accuse of 

infringement. Asetek responds that it never accused the 

K7 or K9 products of infringement, and, in fact, contends

it did not even know that those products existed before 

AVC’s complaint. 

The district court agreed with Asetek and dismissed 

the complaint for lack of subject matter jurisdiction. The 

district court held that the “complaint does not plead 

sufficient facts to show that there is a substantial controversy under the totality of the circumstances.” J.A. 2. 

The district court did not explain its reasons in the written decision, but instead referred to the reasons stated 

during a hearing the court held on the question of jurisdiction. At the hearing, the district court emphasized

that there was never any discussion between the parties 

as to whether AVC’s products were infringing and credited Asetek’s declarations that it was unaware of the existence of those products. AVC timely appealed to us. We 

have jurisdiction under 28 U.S.C. § 1295(a)(1). 

DISCUSSION

We review a district court’s dismissal for lack of subject matter jurisdiction de novo. Powertech Tech. Inc. v. 

Tessera, Inc., 660 F.3d 1301, 1306 (Fed. Cir. 2011). We 

review factual findings underlying the jurisdiction determination for clear error. See SanDisk Corp. v. STMicroelecs., Inc., 480 F.3d 1372, 1377 (Fed. Cir. 2007). The 

burden is on the party claiming declaratory judgment 

jurisdiction to establish that such jurisdiction existed at 

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ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S 5

the time the claim for declaratory relief was filed. Powertech Tech., 660 F.3d at 1306.

The Declaratory Judgment Act provides that “[i]n a 

case of actual controversy within its jurisdiction, . . . any 

court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal 

relations of any interested party seeking such declaration.” 28 U.S.C. § 2201(a). In MedImmune, Inc. v. Genentech, Inc., the Supreme Court stated that the test for 

whether an “actual controversy” exists is “whether the 

facts alleged, under all the circumstances, show that there 

is a substantial controversy, between parties having 

adverse legal interests, of sufficient immediacy and 

reality to warrant the issuance of a declaratory judgment.” 549 U.S. 118, 127 (2007) (internal quotation 

marks omitted).1 

Although it relaxed the test for establishing jurisdiction, MedImmune “did not change the bedrock rule that a 

case or controversy must be based on a real and immediate injury or threat of future injury that is caused by the 

defendants—an objective standard that cannot be met by 

a purely subjective or speculative fear of future harm.” 

Prasco, LLC v. Medicis Pharm. Corp., 537 F.3d 1329, 1339 

 

1 In so doing, the Supreme Court in MedImmune

disagreed with the stricter “reasonable apprehension of 

imminent suit” test that our court had previously applied 

and thus lowered the bar to establish jurisdiction. Teva 

Pharm. USA, Inc. v. Novartis Pharm. Corp., 482 F.3d 

1330, 1339 (Fed. Cir. 2007). Nonetheless, the reasonable 

apprehension test is still a factor and “one of many ways a 

patentee can satisfy the Supreme Court’s more general 

all-the-circumstances test to establish that an action 

presents a justiciable Article III controversy.” Caraco 

Pharm. Labs., Ltd. v. Forest Labs., Inc., 527 F.3d 1278, 

1291 (Fed. Cir. 2008).

Case: 15-1597 Document: 48-2 Page: 5 Filed: 09/08/2016
6 ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S

(Fed. Cir. 2008). Thus, we have explained postMedImmune that “jurisdiction generally will not arise 

merely on the basis that a party learns of the existence of 

a patent owned by another or even perceives such a 

patent to pose a risk of infringement, without some affirmative act by the patentee.” SanDisk, 480 F.3d at 

1381. Instead, we have required “conduct that can be 

reasonably inferred as demonstrating intent to enforce a 

patent.” Hewlett-Packard Co. v. Acceleron LLC, 587 F.3d 

1358, 1363 (Fed. Cir. 2009). 

Here, AVC alleges that, under the totality of circumstances, a substantial controversy of sufficient immediacy 

and reality exists between it and Asetek to warrant 

jurisdiction. It contends that the district court improperly 

focused on Asetek’s contention that it did not specifically 

accuse AVC’s K7 and K9 products of infringement in 

finding no jurisdiction. Asetek responds that, at most, 

AVC’s allegations amount to “a purely subjective apprehension of a future infringement suit involving the K7 

and K9 prototypes” and thus are insufficient to satisfy the 

actual controversy test. Appellee’s Br. 11. 

We agree with AVC that the totality of circumstances 

indicates that an actual controversy existed between the 

parties at the time of the declaratory judgment complaint. 

Although the April 30, 2014 letter incorrectly accused 

AVC of manufacturing the Liqmax 120s, it was still a 

demand letter that referenced a product that AVC contends is similar to its own K7 and K9 products. Upon 

receiving the letter, AVC contacted Asetek, saying that it 

did not manufacture the Liqmax 120s, and then, in a 

follow-up email, AVC requested a meeting with Asetek “to 

discuss the related matter.” J.A. 105. Instead of simply

responding that it had made a mistake with respect to the 

Liqmax 120s, Asetek’s August 2, 2014 email contained a 

number of statements that indicate that an actual controversy between the parties existed. For example, Asetek 

(1) rehashed the volatile relationship between the parties, 

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ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S 7

saying that poor experiences with AVC in the past have 

“sown distrust in Asetek for AVC”; (2) stated that it “does 

not license its patents” generally and, more specifically, 

that it would not license them to AVC due to the previous 

conflicts between the parties; (3) accused AVC of “likely 

selling other infringing products in the United States”; (4) 

warned AVC that it “enforced its IP” and noted its “pending litigations against CoolIT and Cooler Master”—

companies that AVC alleges sell products similar to the 

K7 and K9; and (5) emphasized that it has been allowed a 

patent in the European Union with claims similar to the 

asserted patents and also has similar claims pending in 

China. J.A. 207. Such a response by Asetek clearly 

“demonstrate[s] intent to enforce a patent,” HewlettPackard, 587 F.3d at 1363, and is thus sufficient to conclude that a substantial controversy between the parties 

existed at the time of the complaint. 

The further interactions between the parties only confirm our conclusion. Despite recognizing that AVC does 

not manufacture the Liqmax 120s, Asetek still agreed to a 

meeting with AVC where they discussed potential licensing of the asserted patents. Moreover, AVC alleges that 

Asetek made threats to its customers regarding AVC’s 

infringement of the asserted patents. Specifically, AVC 

alleges that “AVC’s customers for the K7 and K9 products 

have expressed concern that [they will be subject] to 

liability under the Asserted Patents and AVC has withheld accepting purchase order out of fear of possible 

liability based upon the Asserted Patents.” J.A. 67. To 

support its allegation, AVC submitted a declaration from 

its Chief Corporation Officer, David Wang, stating: 

From discussions with representatives of two AVC 

customers, these representatives informed AVC 

that Asetek has expressed to them that AVC has 

infringed Asetek’s U.S. Patents, and that if these 

customers use AVC’s products, then lawsuit will 

follow. These customers are: Thermaltake (a 

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8 ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S

Taiwanese company) and IBuyPower (a U.S. company).

J.A. 213.2 Such threats constitute affirmative actions by 

Asetek to impede and frustrate AVC’s attempts to meaningfully participate in the liquid cooling market and 

further support our conclusion that a substantial controversy existed between the parties.

Asetek relies heavily on the fact that it never referenced AVC’s particular products or product line as potentially infringing, and, in fact, did not even know of AVC’s 

products at the time of the complaint. But we have not 

required such specific facts to find jurisdiction. See ABB 

Inc. v. Cooper Indus., LLC, 635 F.3d 1345, 1348 (Fed. Cir. 

2011) (“[A] specific threat of infringement litigation by the 

patentee is not required to establish jurisdiction.”). 

Indeed, in Arrowhead Industrial Water, Inc. v. Ecolochem, 

 

2 Asetek contends that we should not look beyond 

the allegation in the complaint and thus should not 

consider the declaration. But we have said that “[i]n 

establishing the predicate jurisdictional facts, a court . . . 

may review evidence extrinsic to the pleadings, including 

affidavits and deposition testimony.” Cedars-Sinai Med. 

Ctr. v. Watkins, 11 F.3d 1573, 1584 (Fed. Cir. 1993). 

Asetek also denies making any such threat to AVC’s 

customers and thus says that the disputed allegation is 

“subject to fact-finding by the district court.” Id. Here, 

both the Wang declaration from AVC and Asetek’s declaration denying the allegation were before the district 

court and, although it did not make any explicit fact 

findings, the district court appears to have assumed that 

the allegation was true. We have no reason to conclude 

otherwise. Moreover, even if we were to discount the 

allegation, the August 2, 2014 email itself is sufficient to 

demonstrate that an actual controversy existed between 

the parties at the time of the complaint. 

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ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S 9

Inc., applying the stricter reasonable apprehension test, 

we stated that “a court may find a clear basis for a reasonable apprehension in all the circumstances, even when 

a patentee first learns of plaintiff’s conduct upon receipt 

of the complaint.” 846 F.2d 731, 738 (Fed. Cir. 1988). 

The question of jurisdiction does not turn on Asetek’s 

knowledge of the specific AVC products or whether Asetek 

specifically alleged that the K7 and K9 products infringed 

the asserted patents; instead, the question is whether, 

under all the circumstances, Asetek’s actions “can be 

reasonably inferred as demonstrating intent to enforce a 

patent.” Hewlett-Packard, 587 F.3d at 1363. We conclude 

that Asetek’s conduct demonstrates just that. 

In addition to an affirmative act by Asetek, AVC must 

also show that the threat of suit is real and immediate to 

establish jurisdiction. MedImmune, 549 U.S. at 127. 

“[A]lthough a party need not have engaged in the actual 

manufacture or sale of a potentially infringing product to 

obtain a declaratory judgment of non-infringement, there 

must be a showing of ‘meaningful preparation’ for making 

or using that product.” Cat Tech LLC v. TubeMaster, Inc., 

528 F.3d 871, 881 (Fed. Cir. 2008). Here, AVC has made 

the requisite showing. AVC alleged that (1) it has completed designs of the K7 and K9 products; (2) it has manufactured sample prototype products of the K7 and K9 (as 

confirmed by photographs of the products presented to the 

district court below); (3) it intends to market and sell the 

products in the United States; and (4) its K7 and K9 

products “are positioned to directly compete in the market 

against Cooler Master, Coolit Systems and Enermax as 

well as the Asetek’s products.” J.A. 67. AVC’s allegation 

regarding the concerns of its customers and that it has 

“withheld accepting purchase order[s]” indicates that AVC 

has customers lined up for its products that have submitted, or, at the very least, are prepared to submit purchase 

orders for the products. Id. 

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10 ASIA VITAL COMPONENTS CO. v. ASETEK DANMARK A/S

Asetek does not dispute these allegations but instead 

contends that they do not demonstrate “concrete plans” to 

engage in potentially infringing activities. We disagree. 

This is not the type of case where, at the time the complaint was filed, the accused products were far from being 

complete or operational and were susceptible to design 

changes, making it impossible to compare them against 

the asserted patents. See, e.g., Sierra Applied Scis., Inc. 

v. Advanced Energy Indus., Inc., 363 F.3d 1361, 1380 

(Fed. Cir. 2004) (finding no real or immediate controversy

where the alleged infringer testified that it had no intent 

to market the accused product and “the design [of the 

accused product] was fluid on the date the complaint was 

filed” making it “impossible to determine—on that date—

whether any eventual design of the [accused product]

would infringe [the asserted] patents”); Int’l Harvester Co. 

v. Deere & Co., 623 F.2d 1207, 1216 (7th Cir. 1980) (finding no real and immediate controversy where, as of the 

date of the complaint, the alleged infringer “anticipated 

further, fairly extensive testing of the [accused product] 

including construction of more test models, and anticipated design changes where necessary in response to the 

testing”). This is also not a case like Lujan v. Defenders of 

Wildlife, 504 U.S. 555 (1992), or Matthews International

Corp. v. Biosafe Engineering, LLC, 695 F.3d 1322 (Fed. 

Cir 2012), in which an intent to take action was unaccompanied by any specific plans or steps that might satisfy 

the MedImmune “immediacy” requirement. MedImmune, 

549 U.S. at 127. Instead, AVC provided undisputed 

allegations that it has manufactured prototypes, has 

potential customers, and has a sufficiently immediate 

interest to request a license to clear the path for its intended entrance into the U.S. market. That is sufficient 

to meet the real and immediate test. 

We similarly disagree with Asetek that AVC’s allegations provide insufficient information about whether the 

K7 and K9 products would infringe the asserted patents. 

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AVC specifically stated that its products “may have a 

number of structural similarities to the accused products 

sold by Coolit Systems, Inc. and Cooler Master Co., 

Ltd.”—products which Asetek has alleged infringe the 

asserted patents—and that its products “are positioned to 

directly compete in the market” against those of Cooler 

Master, Coolit Systems, Enermax, and even Asetek. J.A. 

67. Moreover, AVC provided photographs depicting the 

similarities between the K9 product and the Liqmax 

120s—the product that Asetek initially accused of infringement in its demand letter to AVC. AVC was not 

required, as Asetek contends, to specifically allege that 

the structural similarities between its products and the 

competitor products are relevant to the claims of the 

asserted patents; such an allegation is implicit in the 

complaint when read as a whole. Indeed, to require more 

from AVC would precipitate the anomalous result whereby a party seeking a declaration of noninfringement must 

show that its product is the same as the patented product 

in relevant respects. As is clear from our case law—and 

from common sense—that is not the test for jurisdiction. 

See Arrowhead, 846 F.2d at 738 (“It is at best incongruous 

to require that one seeking a declaration of noninfringement prove its process or product is the ‘same as’ or ‘identical’ to the patented process or product.”). 

Thus, we conclude that AVC alleged sufficient facts 

that, “under all the circumstances, show that there is a 

substantial controversy, between parties having adverse 

legal interests, of sufficient immediacy and reality to 

warrant the issuance of a declaratory judgment.” 

MedImmune, 549 U.S. at 127. 

CONCLUSION

For the foregoing reasons, we reverse the ruling of the 

district court and remand for further proceedings. 

REVERSED AND REMANDED

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