Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-16-01026/USCOURTS-ca13-16-01026-0/pdf.json

Parties Involved:
Asetek Danmark A/S
Appellee
CMI USA Inc.
Appellant
Cooler Master Co., Ltd.
Appellant

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________ 

ASETEK DANMARK A/S,

Plaintiff-Appellee

v.

CMI USA INC., FKA COOLER MASTER USA, INC., 

COOLER MASTER CO., LTD.,

Defendants-Appellants

______________________ 

2016-1026, 2016-1183

______________________ 

Appeals from the United States District Court for the 

Northern District of California in No. 3:13-cv-00457-JST, 

Judge Jon S. Tigar.

______________________ 

Decided: December 6, 2016

______________________ 

ERIK R. PUKNYS, Finnegan, Henderson, Farabow, 

Garrett & Dunner, LLP, Palo Alto, CA, argued for plaintiff-appellee. Also represented by ROBERT F. MCCAULEY,

JEFFREY DANIEL SMYTH; ARPITA BHATTACHARYYA, Boston, 

MA. 

KYLE DAKAI CHEN, Cooley LLP, Palo Alto, CA, argued 

for defendants-appellants. Defendant-appellant CMI USA 

Inc. also represented by REUBEN HO-YEN CHEN. 

______________________ 

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2 ASETEK DANMARK A/S v. CMI USA INC. 

Before PROST, Chief Judge, NEWMAN, and TARANTO,

Circuit Judges.

Opinion for the court filed by Circuit Judge TARANTO. 

Opinion dissenting in part filed by Chief Judge PROST. 

TARANTO, Circuit Judge. 

In January 2013, Asetek Danmark A/S sued two 

parties—Cooler Master USA, Inc., which a month later 

became CMI USA Inc.; and Cooler Master Co., Ltd., a 

Taiwanese company—in the Northern District of California, asserting infringement of two of Asetek’s patents, 

U.S. Patent Nos. 8,240,362 and 8,245,764. All of the 

accused products are branded “Cooler Master.” A few 

months before trial, by stipulation, Asetek dismissed with 

prejudice its claims against the Taiwanese company

(hereafter “Cooler Master”). Asetek’s claims of infringement by CMI USA (hereafter “CMI”), and CMI’s invalidity 

counterclaims, were tried partly to a jury and partly to 

the court. Asetek prevailed and received a judgment of 

infringement, and of no invalidity, plus a damages award 

against CMI of $404,941, based on a 14.5% royalty rate. 

The district court also entered an injunction covering the 

specific “Cooler Master” products found to infringe. The 

injunction runs not only against CMI but also against 

Cooler Master—which was not then a party (though it 

later intervened and became one) and which was not

adjudicated liable for infringement.

We affirm the district court’s rulings on infringement, 

invalidity, and damages. We remand as to part of the 

injunction, i.e., insofar as the injunction reaches conduct 

by Cooler Master (regarding the covered products) that 

goes beyond abetting a new violation by CMI. The governing standards for reaching such conduct by persons 

not adjudicated liable for the underlying wrong, reflected 

in Federal Rule of Civil Procedure 65(d), are highly factspecific. In this case, a determination of the propriety of 

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ASETEK DANMARK A/S v. CMI USA INC. 3

the injunction’s reach would benefit from further findings 

and, if sought and needed, further record development. 

I 

The ’362 and ’764 patents describe and claim systems

and methods for cooling the “central processing unit 

(CPU) or other processing unit of a computer system” 

using cooling liquid. ’362 patent, col. 1, lines 12–14; ’764 

patent, col. 1, lines 11–13. According to the patents, 

which have similar specifications, liquid-cooling systems 

in the prior art consisted of “many components,” which 

were “coupled together,” increasing “total installation 

time” and causing “leakage.” ’362 patent col. 1, lines 34–

49; ’764 patent, col. 1, lines 32–37. By contrast, the ’362 

and ’764 patents describe systems that combine multiple 

components—a “heat-exchanging interface,” a “reservoir,” 

and a “pump”—into a single “integrate element.” ’362

patent, col. 2, lines 9–11; ’764 patent, col. 2 lines 5–6. As 

recited in the asserted claims, the “reservoir” includes two

“vertically” separated chambers, referred to as the “upper 

chamber” and “lower chamber,” ’362 patent, col. 18, lines 

56–65, or “pump chamber” and “thermal exchange chamber,” ’764 patent, col. 27, lines 49–57.

Claim 1 of the ’764 patent is representative:

1. A cooling system for a heat-generating 

component, comprising:

a double-sided chassis adapted to mount a 

pump configured to circulate a cooling liquid, 

the pump comprising a stator and an impeller, 

the impeller being positioned on the underside 

of the chassis and the stator being positioned 

on the upper side of the chassis and isolated 

from the cooling liquid;

a reservoir adapted to pass the cooling 

liquid therethrough, the reservoir including: 

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4 ASETEK DANMARK A/S v. CMI USA INC. 

a pump chamber including the impeller and formed below the chassis, the 

pump chamber being defined by at least 

an impeller cover having one or more passages for the cooling liquid to pass 

through;

a thermal exchange chamber formed 

below the pump chamber and vertically 

spaced apart from the pump chamber, the 

pump chamber and the thermal exchange 

chamber being separate chambers that are 

fluidly coupled together by the one or 

more passages; and

a heat-exchanging interface, the heatexchanging interface forming a boundary 

wall of the thermal exchange chamber, 

and configured to be placed in thermal 

contact with a surface of the heatgenerating component; and

a heat radiator fluidly coupled to the 

reservoir and configured to dissipate heat 

from the cooling liquid.

’764 patent, col. 27, lines 39–65. The asserted claims of 

the ’362 patent are similar, but additionally require the 

“heat-exchanging interface” to be “removably attached” or 

“removably coupled” to the “reservoir.” ’362 patent, col. 

20, lines 3–6; id. col. 20, lines 40–44.

“Cooler Master is a Taiwanese supplier of computer 

components, including cooling devices for heat generating 

components” of computers. Appellants’ Br. 24. Its products include the “Cooler Master”-branded Seidon 120M, 

Seidon 120XL, Seidon 240M, Seidon 120V, Seidon 120V 

Plus, Glacer 240L, Nepton 140XL, and Nepton 280L

liquid-cooling products at issue in this case. CMI is a U.S. 

company that—as reflected in its name (“Cooler Master 

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ASETEK DANMARK A/S v. CMI USA INC. 5

USA, Inc.”) until February 2013, a month after this suit 

began, ECF Nos. 60, 61 (May 2014 change of caption)—

collaborates with Cooler Master in designing and selling 

“Cooler Master”-branded products in the United States. 

J.A. 3562–63. CMI also “assists” Cooler Master “in setting the manufacturer’s suggested retail price of the 

accused products sold in the United States.” J.A. 3563. 

The evidence, seemingly undisputed, is that, by oral 

agreement, CMI was Cooler Master’s exclusive U.S. 

distributor of Cooler Master products. J.A. 7848–49; 

Transcript of Proceedings at 1069, 1106–07, Asetek Danmark A/S v. CMI USA, Inc., 00457-JST (N.D. Cal. Dec. 

10, 2014), ECF No. 243. Between 2012 and 2013, CMI 

began selling specified Seidon, Glacer, and Nepton models 

of “Cooler Master”-branded products in the United States.

In its January 2013 suit against CMI and Cooler Master, Asetek asserted that they were infringing claims 14–

15 and 17–19 of the ’362 patent and claims 1–15 and 17–

18 of the ’764 patent by selling, offering to sell, and importing the Seidon, Glacer, and Nepton products.1 Discovery proceeded, and infringement and invalidity 

contentions were filed. By September 5, 2014, the litigation was far enough along that CMI moved for summary 

judgment of invalidity. Cooler Master did not join that 

motion, however, because, the day before, it and Asetek 

stipulated to Cooler Master’s dismissal with prejudice—a 

 

1 Asetek’s complaint did not identify the Seidon 

120V Plus, and the jury did not specifically find that the 

’362 and ’764 patents covered that product. But the 

district court’s injunction identified the Seidon 120V Plus 

as an infringing device because Asetek and CMI stipulated that it has the same pump head design as the Seidon 

120V, which was specifically considered by the jury. On 

appeal, neither CMI nor Cooler Master challenges the 

inclusion of the Seidon 120V Plus in the injunction. 

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6 ASETEK DANMARK A/S v. CMI USA INC. 

dismissal entered on September 5, 2014. Asetek agreed to 

that dismissal after CMI and Cooler Master witnesses 

testified, in discovery, to Cooler Master’s exclusivedistribution arrangement with CMI for the accused products in the United States. 

The case went to trial a few months later, in December 2014. At trial, CMI argued that the ’362 patent was 

not infringed, that the ’764 patent was anticipated by U.S. 

Patent No. 7,544,049 (Koga), and that the ’362 and ’764 

patents were obvious over Koga and Korean Utility Model 

No. 20-0314041 (Ryu). The district court granted Asetek’s 

motion for judgment as a matter of law that Koga did not 

anticipate claim 4 of the ’764 patent, and the jury returned a verdict for Asetek on the remaining issues. The 

jury found that CMI infringed, directly and contributorily,

the asserted claims of the ’362 patent and rejected CMI’s

Koga-based anticipation challenge to the remaining 

claims of the ’764 patent. Additionally, the jury made 

specific findings, related to obviousness, about the level of 

ordinary skill in the relevant art, the scope and content of 

the prior art, differences between the prior art and the 

inventions claimed by the ’362 and ’764 patents, and 

objective indicia of non-obviousness. For example, the 

jury found that the claimed liquid-cooling systems differ 

from the prior art because they combine a “pump” and a 

“reservoir” “into a single unit” and because the “reservoir” 

is a “single receptacle that is divided into an upper chamber and a lower chamber.” The jury also found six objective indicia of non-obviousness. The jury found Asetek 

entitled to a 14.5% reasonable-royalty rate and awarded 

$404,941 in damages.

In April 2015, the district court entered its findings of 

fact and conclusions of law on various matters the parties 

had reserved to it. Asetek Danmark A/S v. CMI USA, 

Inc., 100 F. Supp. 3d 871 (N.D. Cal. 2015). The court 

concluded that CMI failed to prove that the ’362 and ’764 

patents were invalid for obviousness, lack of written 

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ASETEK DANMARK A/S v. CMI USA INC. 7

description, or indefiniteness. In September 2015, the

district court denied CMI’s motions for judgment as a 

matter of law or a new trial on infringement and damages 

as well as for a new trial on obviousness. Asetek Danmark A/S v. CMI USA, Inc., No. 3:13-cv-00457-JST, 2015 

WL 5568360, at *3–12 (N.D. Cal. Sept. 22, 2015). 

At the same time, the district court granted Asetek’s 

motion for an injunction against both CMI and Cooler 

Master, the latter not then a party. Id. at *12–21. After 

identifying the “Infringing Products” covered (specified 

Seiden, Nepton, and Glacer models), the injunction states:

(2) CMI USA, Inc. and its subsidiaries and affiliated companies (collectively defined as “CMI”), as 

well as CMI’s successors, assigns, officers, directors, agents, servants, employees, representatives 

and attorneys, and those persons in active concert 

or participation with them who receive notice of 

the order are hereby immediately and permanently restrained and enjoined, pursuant to 35 U.S.C. 

§ 283 and Fed. R. Civ. P. 65(d), from making, using, offering for sale or selling in the United 

States, or importing into the United States, or 

causing to be made, used, offered for sale, or sold

in the United States, or imported into the United 

States, the Infringing Products.

(3) Cooler Master Co., Ltd. and its subsidiaries 

and affiliated companies (collectively defined as 

“Cooler Master”), as well as Cooler Master’s successors, assigns, officers, directors, agents, servants, employees, representatives and attorneys, 

and those persons in active concert or participation with them who receive notice of the order are 

hereby immediately and permanently restrained 

and enjoined, pursuant to 35 U.S.C. § 283 and 

Fed. R. Civ. P. 65(d), from making, using, offering 

for sale or selling in the United States, or importCase: 16-1026 Document: 65-2 Page: 7 Filed: 12/06/2016
8 ASETEK DANMARK A/S v. CMI USA INC. 

ing into the United States, or causing to be made, 

used, offered for sale, or sold in the United States, 

or imported into the United States, the Infringing 

Products.

(4) Within 14 days of issuance of this order, CMI 

and Cooler Master shall provide written notice of 

this judgment and order, and the injunction ordered herein, to: their officers, directors, agents, 

servants, representatives, attorneys, employees, 

subsidiaries and affiliates, and those persons in 

active concert or participation with them. CMI 

and Cooler Master shall take whatever means are 

necessary or appropriate to ensure that this order 

is properly complied with.

(5) CMI and Cooler Master shall include a copy of 

this Order and the written notice in paragraph (6) 

below [stating that the product is affected by a 

permanent injunction, infringes the ’362 and ’764 

patents, and “may not be sold, offered for sale,” 

“used,” or “imported into the United States”] along 

with every bill of sale for the Infringing Products 

and in the boxes in which the Infringing Products 

are shipped or sold, regardless of where they are 

sold, indicating that they infringe the patents-insuit, are subject to an injunction in the United 

States, and thus cannot be sold, offered for sale, 

imported, or used in the United States.

Id. at *20. The injunction lasts until the ’362 and ’764 

patents expire, except that either party may seek modification if either patent is finally adjudged invalid in another proceeding. Id. at *21. 

In January 2016, Cooler Master appealed the injunction, paragraphs (3)–(5) of which impose obligations on it. 

Cooler Master then intervened, becoming a party again, 

even though in similar circumstances non-parties have 

been permitted to appeal. See, e.g., Class Plaintiffs v. City 

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ASETEK DANMARK A/S v. CMI USA INC. 9

of Seattle, 955 F.2d 1268, 1277 (9th Cir. 1992) (“a nonparty who is enjoined or otherwise directly aggrieved by a 

judgment has standing to appeal the judgment without 

having intervened in the district court”). The district 

court subsequently denied Cooler Master’s motion to stay 

the injunction. 

CMI and Cooler Master appeal. CMI and Cooler Master present challenges to the district court’s post-trial 

rulings on infringement and obviousness and to the 

injunction. CMI also presents challenges to the district 

court’s post-trial rulings on damages. We have jurisdiction under 28 U.S.C. § 1295(a)(1).

II

We review a denial of a motion for judgment of a matter of law de novo and must affirm unless “the evidence, 

construed in the light most favorable to the nonmoving 

party, permits only one reasonable conclusion, and that 

conclusion is contrary to the jury’s verdict.” Pavao v. 

Pagay, 307 F.3d 915, 918 (9th Cir. 2002). We review a 

denial of a motion for new trial for abuse of discretion. 

Incalza v. Fendi N. Am., Inc., 479 F.3d 1005, 1013 (9th 

Cir. 2007). We review a grant of a permanent injunction 

for an abuse of discretion, with underlying legal conclusions reviewed de novo. S.E.C. v. Goldfield Deep Mines 

Co. of Nev., 758 F.2d 459, 465 (9th Cir. 1985).

A 

Appellants argue that the jury was required to find 

the ’362 patent not infringed as a matter of law. Specifically, they contend that the alleged “heat exchanging 

interfaces” in the accused products are not “removably 

attached” or “removably coupled” to “reservoirs,” as the 

asserted claims require. The reason, appellants say, is 

that removing the “heat exchanging interfaces” in the 

accused products would “damage the products or otherwise render them nonfunctional.” Appellants’ Br. 37. 

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10 ASETEK DANMARK A/S v. CMI USA INC. 

We reject appellants’ non-infringement argument. 

“[W]here the parties and the district court elect to provide 

the jury only with the claim language itself, and do not 

provide an interpretation of the language in the light of 

the specification and the prosecution history,” the jury’s 

findings “must be tested by the charge actually given and 

by giving the ordinary meaning of the language of the 

jury instruction,” and the only question is one of substantial evidence. Hewlett-Packard Co. v. Mustek Sys., Inc., 

340 F.3d 1314, 1321 (Fed. Cir. 2003). That rule applies 

here, because the parties did not request a construction of 

the claim terms “removably attached” or “removably 

coupled,” and they did not object to the district court’s 

jury instructions. Applying the ordinary meaning, then, 

we conclude that substantial evidence supports the finding of infringement. 

The jury was entitled to find that the “heat exchanging interfaces” in the accused products were “removably 

attached” or “removably coupled.” Asetek’s expert, Dr. 

Tilton, narrated videos about the Seidon 120M, Seidon 

120V, Glacer 240L, and Nepton 140XL products and 

testified that the “heat exchanging interfaces” in those 

products could be removed by unscrewing the trianglehead safety screws that secured them. Dr. Tilton explained that he had removed the screws in each of the 

accused devices using commercially available screwdrivers. CMI’s expert, Dr. Carman, agreed that the “heat 

exchanging interfaces” could be removed, but testified 

that they were not “removably attached” or “removably 

coupled” because the screws were not intended to be 

removed. The jury could reasonably reject Dr. Carman’s

opinion about whether unscrewing was intended, or his 

opinion about whether unscrewing was needed to meet 

the “removably attached” or “removably coupled” requirements, or both.

Likewise, the jury could reasonably find the requirements met even though removing the “heat exchanging 

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ASETEK DANMARK A/S v. CMI USA INC. 11

interfaces” from the accused products would cause coolant 

to leak. There is nothing unreasonable about finding a 

component “removably attached” if it can be detached in 

such a way that the device would function again if the 

component were reattached. And contrary to appellants’ 

contention, the patent specification here does not require 

functionality upon detachment with no further steps: the 

cited passage describes an embodiment in which, if the 

“heat exchanging interface” is “excluded” from the embodiment, “sealing” must be provided to prevent “cooling 

liquid” from “leaking” from the “reservoir.” ’362 patent,

col. 8, lines 66–67, and col. 9, lines 13–19.

Dorel Juvenile Group, Inc. v. Graco Children’s Products, Inc., 429 F.3d 1043 (Fed. Cir. 2005), which interpreted superficially similar claim terms, does not establish 

non-infringement here. In Dorel, which involved a patent 

on a child’s car seat, the asserted claims recited a “base,” 

which was “removably attached” and “removably secured” 

to a “seat.” Id. at 1044–45. We upheld a claim construction, relying on the specification for context, that “removably attached” in that case implied that the “seat” and 

“base” were “affixed together in a manner that contemplates that the seat may be removed from the base such 

that the seat remains functional.” Id. at 1045. The 

present case involves no claim construction, but instead 

claim application, and the context is quite different, e.g., 

there is no requirement here that each component was 

meant to function separately (unlike the seat in Dorel).

B

Appellants argue that the subject matter of the asserted claims of the ’764 patent would have been obvious

over Koga and Ryu. Specifically, they argue that, as a 

matter of law, Koga’s “sucking channel” is a “thermal 

exchange chamber” (a requirement of all asserted claims 

of the ’764 patent) because the “sucking channel” “exchanges some heat.” Appellants’ Br. 45. The district 

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12 ASETEK DANMARK A/S v. CMI USA INC. 

court found that Koga did not teach this claim element, a 

factual component of the obviousness analysis. Asetek, 

100 F. Supp. 3d at 886–88. That finding is not clear error. 

Specifically, the fact that Koga’s “sucking channel” exchanges some heat, no matter how minimal and inevitable, does not entail that it is properly considered a 

“thermal exchange chamber.”2

No ordinary meaning or claim construction requires 

appellants’ conclusion that Koga’s “sucking channel” is a 

“thermal exchange chamber” simply because it exchanges 

some heat. No meaning of the claim phrase precludes its 

limitation only to devices with certain device-defining 

characteristics such as purpose and principal use, excluding other structures that occasionally or in minor ways 

produce the same result—any more than a bedside plugin radio must be considered a room radiator because it 

unavoidably gives off some heat. As the district court 

noted, accepting appellants’ conclusion courts draining 

any meaning from “thermal exchange” in the “thermal 

exchange chamber” phrase. Asetek, 2015 WL 5568360, at 

*10. Under appellants’ theory, any chamber would seem 

to count as a “thermal exchange chamber” because, as Dr. 

Tilton testified, “[h]eat transfer will always happen 

between any two bodies that are at . . . different temperatures.” Transcript of Proceedings at 1558, Asetek Danmark A/S v. CMI USA, Inc., No. 3:13-cv-00457-JST (N.D. 

Cal. Dec. 16, 2014) (“Dec. 16 Tr.”), ECF No. 215. That 

 

2 Asetek argues that a substantial-evidence standard applies, because the jury implicitly found that Koga’s 

“sucking chamber” was not a “thermal exchange chamber” 

in rejecting anticipation. We need not scrutinize the jury 

verdict or otherwise address that contention. Any difference between “clear error” and “substantial evidence” 

makes no difference to our conclusion about Koga and the 

claim element at issue.

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ASETEK DANMARK A/S v. CMI USA INC. 13

would appear true even for an insulated chamber, because 

imperfections in the insulation would result in some heat 

transfer. It was proper to reject appellants’ theory. 

Moreover, sufficient evidence supports the district 

court’s finding that a person of ordinary skill in the art 

would not consider Koga’s “sucking channel” to be a 

“thermal exchange chamber.” Dr. Tilton testified that the 

purpose of Koga’s “sucking channel” was to deliver fluid to 

Koga’s “pump room,” not to transfer heat; that any heat 

transferred by the “sucking channel” would be inconsequential because of its small surface area and the high 

rate of flow through it; and that Koga positively teaches 

away from placing the “sucking channel” on top of, and in 

thermal contact with, Koga’s “heat generating component,” as the ’764 patent requires. Transcript of Proceedings at 1417–18, Asetek, 3:13-cv-00457-JST (N.D. Cal. 

Dec. 15, 2014), ECF No. 213. Dr. Carman, CMI’s expert,

testified that heat exchange was not the purpose of Koga’s 

“sucking channel.” Dec. 16 Tr. at 1645. On the evidence,

the district court could reasonably find that Koga’s “sucking channel” was not a “thermal exchange chamber.”

This is a claim-specific finding about what characterizes some devices as a “thermal exchange chamber” and

Koga’s “sucking channel” not having those characteristics. 

As a result, appellants are wrong in suggesting that the

finding is contrary to various precedents. Those precedents all involve situations where a reference or device 

does come within a claim term. See Abbott Labs. v. 

Sandoz, Inc., 566 F.3d 1282, 1299 (Fed. Cir. 2009) (where 

a claim term covers an accused product or process, there 

is infringement even if de minimis); Embrex, Inc. v. Service Eng’g Corp., 216 F.3d 1343, 1349 (Fed. Cir. 2000)

(same); Verdegaal Bros., Inc. v. Union Oil Co. of Cal., 814 

F.2d 628, 630, 632 (Fed. Cir. 1987) (claim element of 

“making a concentrated liquid fertilizer by reacting sulfuric acid and urea” taught by reference requiring the 

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14 ASETEK DANMARK A/S v. CMI USA INC. 

sulfuric acid to be “added slowly”). That is enough to 

distinguish those precedents from this case.

C 

We also reject CMI’s challenge to the damages award. 

CMI argues that, in calculating the 14.5% royalty award,

Asetek’s damages expert, Dr. Mody, improperly relied on

Asetek’s per-unit profit margin under its licensing agreement with another company, Corsair. According to CMI, 

Dr. Mody’s approach circumvented the requirement, 

applicable when lost-profits damages are sought, that a 

patent owner prove that it would have made the infringer’s sales “but for” the infringement—a requirement not 

applicable to reasonable-royalty damages. See BIC Leisure Prods., Inc. v. Windsurfing Int’l, Inc., 1 F.3d 1214, 

1218 (Fed. Cir. 1993); Panduit Corp. v. Stahlin Bros. 

Fibre Works, Inc., 575 F.2d 1152, 1156 (6th Cir. 1978). 

Additionally, CMI argues that the royalty award is not 

supported by substantial evidence because the AsetekCorsair license included a maximum royalty rate of 7%. 

We reject both arguments.

35 U.S.C. § 284 guarantees to a patent holder damages 

“adequate to compensate for the infringement, but in no 

event less than a reasonable royalty.” A patent owner, 

having prevailed on liability, may receive a reasonable 

royalty or lost profits, but not both for the same infringing 

units. See SmithKline Diagnostics, Inc. v. Helena Labs. 

Corp., 926 F.2d 1161, 1164 (Fed. Cir. 1991). There is no 

dispute here about the propriety of using the common 

hypothetical-negotiation approach to calculating a reasonable royalty, under which the finder of fact “attempts 

to ascertain the royalty upon which the parties would 

have agreed had they successfully negotiated an agreement just before infringement began.” Lucent Techs., Inc. 

v. Gateway, Inc., 580 F.3d 1301, 1324 (Fed. Cir. 2009). 

The amount of damages presents a fact question, reviewed for substantial evidence in a jury-tried case, and 

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ASETEK DANMARK A/S v. CMI USA INC. 15

the underlying methodology is reviewed for an abuse of 

discretion, including consistency with governing legal 

principles. See Aqua Shield v. Inter Pool Cover Team, 774 

F.3d 766, 770 (Fed. Cir. 2014); Micro Chem., Inc. v. Lextron, Inc., 317 F.3d 1387, 1394 (Fed. Cir. 2003).

To the extent that Dr. Mody’s analysis referred to 

Asetek’s per-unit profit on its cooling units, CMI’s legal 

objection lacks merit. As we have recognized, a patent 

owner participating in a hypothetical negotiation would 

consider the profits on sales it might lose as a result of 

granting a license. Rite-Hite Corp. v. Kelley Co., 56 F.3d 

1538, 1554–55 (Fed. Cir. 1995) (en banc).3 The fact that a 

royalty calculation relies in part on the patent owner’s 

per-unit profits does “not make it an unreasonable 

award.” Id. at 1555. We have explained that a patent 

owner would be “unlikely” to be “interested in” accepting

a royalty rate lower than its profit margin on the patented 

products. See Mitutoyo Corp. v. Cent. Purchasing, LLC, 

499 F.3d 1284, 1292 (Fed. Cir. 2007) (stating that the 

patent owner would be “unlikely [to] have been interested 

in less than a 29.2% [reasonable-royalty] rate,” equal to 

the patent owner’s profit margin). Negotiating for a perunit payment equal to its per-unit profit can be a logical 

approach for a patent owner that is uncertain of how 

many sales might be lost by granting the license at issue

or is just using its own experience to place a value on the 

right to use the technology at issue. 

 

3 We have also explained that a patent owner in a 

hypothetical negotiation would rationally consider not 

only its own potential losses from licensing but those of 

parent, sister, or similarly related companies. See Union 

Carbide Chems. & Plastics Tech. Corp. v. Shell Oil Co., 

425 F.3d 1366, 1378 (Fed. Cir. 2005), overruled on another 

issue, Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 576 

F.3d 1348 (Fed. Cir. 2009) (en banc in part).

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16 ASETEK DANMARK A/S v. CMI USA INC. 

In its Reply Brief, CMI acknowledges “that profits may 

be considered as a factor in the reasonable royalty calculation,” but it argues error in the damages verdict on the 

ground that this factor “predominated and virtually 

subsumed Asetek’s entire damages case.” Reply Br. 24. 

But CMI identifies no legal principle about predominance 

that would somehow bar a damages analysis that takes 

reasonable account of all the evidence relevant to the 

hypothetical negotiation—as Dr. Mody’s analysis did. As 

Dr. Mody testified, she adjusted her hypotheticalnegotiation model to account for numerous considerations 

other than Asetek’s per-unit profits, including “the nature 

and the scope of the license” at issue, Transcript of Proceedings at 866, Asetek, No. 3:13-cv-00457-JST (N.D. Cal. 

Dec. 9, 2014) (“Dec. 9 Tr.”), ECF No. 242; see id. at 855, 

Asetek’s “established policy and marketing program,” id.

at 867, the “commercial relationship” between Asetek and 

CMI, id. at 855, and the extent to which CMI’s profits 

under the license would “be attributable to the patented 

invention,” id. CMI has not shown that the resulting 

damages verdict rests on a legally improper methodology. 

Nor has CMI shown, as it suggests, that the use of 

Asetek’s per-unit profit in the royalty analysis makes lostprofits damages no longer worth pursuing by patent 

owners. There are obvious reasons for some patent owners to pursue lost profits. In some circumstances, e.g., 

where the patent owner is a strong economic monopolist, 

proof of lost sales caused by the infringement and the 

profits on those lost sales (as well as loss of profits from 

sales made at prices lowered by the infringement) may be 

less uncertain than proof of a reasonable royalty under 

the standards applicable to the latter. And a lost-profit 

award can be higher. A hypothetical-negotiation analysis 

for a royalty considers not only the patent owner’s interests, but also the other side of the negotiation table under 

the particular conditions of the hypothetical negotiation. 

See Aqua Shield, 774 F.3d at 770–72 & n.1. A lost-profits 

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ASETEK DANMARK A/S v. CMI USA INC. 17

analysis is different, because as a general matter, the 

patent owner is entitled to be made whole, upon proper 

proof, for its loss of profits caused by the infringement, 

without discounting for the rational interests limiting 

willingness to pay on the infringer’s side. Not surprisingly, a leading commentary observes that “[l]ost profits 

damages frequently bring the patent owner much more 

than royalty awards” and are sought “in nearly every case 

in which the patent owner manufactures or sells something that could reasonably be interpreted as competing 

with an infringer’s product.” John Skenyon, Christopher 

Marchese & John Land, Patent Damages Law and Practice § 2:1, at 64 (2015 ed.) (footnote omitted). 

Finally, substantial evidence supports the jury’s finding that a hypothetical negotiation between Asetek and 

CMI would have resulted in a 14.5% reasonable royalty 

rate, even though one portion of the Corsair license included a maximum royalty rate of 7%. First, as Dr. Mody 

testified, the Corsair license included an effective royalty 

rate of between 10% and 19% based on two components: 

(1) the actual royalty rate of between 2% and 7% and (2) 

the minimum-purchase requirement. Using that range, 

Dr. Mody concluded that Asetek and CMI would have 

agreed to a royalty rate of about 16%. Second, Dr. Mody 

testified that Asetek would have sought a higher royalty 

rate from CMI than from Corsair because Asetek would 

have treated CMI as a “competitor,” rather than a valued 

“customer” (like Corsair). See Dec. 9 Tr. at 855, 858, 868–

71. Although CMI’s general manager, Mr. Chen, testified 

that Asetek was willing to license its products to CMI and

Cooler Master, that assumption, even if credited, hardly 

means that Asetek would have treated them the same as 

Corsair. We conclude that the jury’s adoption of a 14.5% 

royalty rate must be affirmed.

Case: 16-1026 Document: 65-2 Page: 17 Filed: 12/06/2016
18 ASETEK DANMARK A/S v. CMI USA INC. 

D 

Cooler Master and CMI together challenge the injunction on two grounds. See Appellants’ Br. 6 (injunction 

challenge presented for both appellants). First, they 

argue that Cooler Master’s September 2014 dismissal 

from the case with prejudice precluded the district court 

from subjecting Cooler Master to the injunction’s obligations. Second, they argue that the injunction is too broad 

in scope insofar as the injunction reaches Cooler Master’s 

conduct (sale, importation, etc., involving the identified 

“Cooler Master”-branded products) other than conduct 

that abets a new violation by CMI, the only party adjudicated liable for infringement.

The latter argument invokes the standards that define the limited circumstances in which injunctive obligations may be imposed on persons who have not been 

adjudicated liable for the wrong for which the injunction 

is a remedy. It is worth noting the limited scope of the 

argument appellants have made on appeal in this regard—which does not include arguments that, in certain 

circumstances in other cases, persons not held liable have 

made and may make against being subjected to injunctive 

obligations. Thus, appellants do not argue that the district court lacked personal jurisdiction over Cooler Master. They do not argue that Cooler Master lacked notice 

or an opportunity to be heard on the issues related to the 

injunction. Nor do they argue that the injunction is 

improper under eBay Inc. v. MercExchange, L.L.C., 547 

U.S. 388 (2006), or because Cooler Master does not sufficiently threaten to engage in the covered conduct. In 

addition, appellants do not argue that naming Cooler 

Master in the injunction is independently improper, but 

only that the challenged obligations imposed on Cooler 

Master here are improper for reasons it could invoke if

they were imposed through contempt. See Aevoe Corp. v. 

AE Tech Co., Ltd., 727 F.3d 1375, 1383–84 (Fed. Cir. 

2013) (because S&F Defendants were privies of the origiCase: 16-1026 Document: 65-2 Page: 18 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 19

nally enjoined party AE Tech, and not acting independently, naming them in modification of injunction 

merely made explicit what was already implicit). Moreover, in challenging certain injunctive coverage of Cooler 

Master, appellants do not separately challenge the language reaching the “successors, assigns,” etc. of Cooler 

Master if Cooler Master itself is properly covered. And 

appellants do not dispute that Cooler Master is properly 

subject to injunctive obligations to avoid actions that 

would abet a new violation by CMI. See Reply Br. 26.

We address appellants’ two appellate arguments in 

turn. The first argument, based on the agreed-to dismissal of Cooler Master shortly before trial, we reject. The 

second, narrower argument we think warrants a remand 

for further proceedings, given the fact-specificity of the 

relevant standards in this delicate area. 

1 

Appellants contend that, even if an injunction against 

Cooler Master would be proper had no claim ever been 

filed against it in this case, it cannot be enjoined because 

it was initially a defendant and the claims against it were 

dismissed with prejudice. Appellants rest that contention 

on the premise that dismissal is an adjudication that has 

claim-preclusive effect. But, while the premise is correct, 

the inference appellants urge—that claim preclusion bars 

relief as to future conduct—is not.

Appellants’ argument assumes that the “claim” covered by the dismissal, which concerned Cooler Master’s 

pre-dismissal conduct, is the same as a “claim” covering 

conduct subject to the injunction, which is Cooler Master’s 

future conduct—not just post-dismissal, but post-trial and 

post-injunction-issuance. It is well established, however, 

that the difference in timing means that the two situations do not involve the same “claim” for claim-preclusion 

purposes, even if all the conduct is alleged to be unlawful 

for the same reason. See Dow Chems. Corp. v. NOVA

Case: 16-1026 Document: 65-2 Page: 19 Filed: 12/06/2016
20 ASETEK DANMARK A/S v. CMI USA INC. 

Chems. Corp. (Can.), 803 F.3d 620, 626–27 (Fed. Cir. 

2015); Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 

F.3d 1335, 1343 (Fed. Cir. 2012); 18 Charles Alan Wright, 

Arthur R. Miller & Edward H. Cooper, Federal Practice 

and Procedure § 4409 (2d ed. 2002). As we have explained, “a party who sues a tortfeasor is ordinarily not 

barred by a prior judgment from seeking relief for discrete 

tortious action by the same tortfeasor that occurs subsequent to the original action.” Aspex Eyewear, 672 F.3d at 

1342. The rationale is simple: claim preclusion “requires 

a party to assert all claims that the party could have 

asserted in the earlier lawsuit”; and a party cannot assert 

claims based on “tortious conduct” that “had not occurred 

at that time—those claims could not have been asserted 

and therefore are not barred.” Id.

Appellants cite nothing to the contrary. The cited decisions establish only that a stipulated dismissal “generally constitutes a final judgment on the merits” that 

“precludes a party from reasserting the same claims” or 

“same cause,” Headwaters Inc. v. U.S. Forest Service, 399 

F.3d 1047, 1051−52 (9th Cir. 2005); In re Marino, 181 

F.3d 1142, 1144 (9th Cir. 1999), or from challenging “acts

[that] fell within the scope of the pleadings” of the dismissed action, Esquire, Inc. v. Varga Enters., Inc., 185 

F.2d 14, 17 (7th Cir. 1950). They do not address future 

conduct like that covered by the injunction at issue here.

2 

The fundamental principle relevant to appellants’ 

narrower, scope objection to the injunction here is that an 

injunction may not “make punishable the conduct of 

persons who act independently and whose rights have not 

been adjudged according to law.” Regal Knitwear Co. v. 

NLRB, 324 U.S. 9, 13 (1945) (citing Chase Nat’l Bank v.

City of Norwalk, 291 U.S. 431, 436–37 (1934), and other 

decisions). But as that formulation suggests, an injunction may reach certain conduct by persons not held liable 

Case: 16-1026 Document: 65-2 Page: 20 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 21

for the underlying wrong where the conduct is not undertaken “independently” of the persons who have been held 

liable. Federal Rule of Civil Procedure 65(d) reflects the 

standards when it declares that an injunction “binds only” 

“the parties,” “the parties’ officers, agents, servants, 

employees, and attorneys,” and “other persons who are in 

active concert or participation” with them “who receive 

actual notice of [the injunction] by personal service or 

otherwise.”

In this case, the injunction imposes two sorts of obligations on Cooler Master—it restricts conduct by Cooler 

Master that abets a new violation by CMI; and it also 

restricts conduct by Cooler Master that does not abet a 

new violation by CMI. Putting aside the dismissal-based 

contention, which we have rejected, appellants object here 

only to the latter obligations. Those are found explicitly 

in paragraphs 3, 4, and 5 of the injunction. And they are 

found implicitly in paragraph 2, because, under wellestablished law, that paragraph’s “active concert or participation” coverage includes some conduct not abetting a 

new violation by the liable person—such as might occur, 

under certain circumstances, if a liable person (like CMI 

here) turned over the wrongful operations to another 

person or even simply ceased operating or existing altogether, to be succeeded by another. As the parties made 

clear at oral argument, there is a current live dispute 

about the permissibility of barring Cooler Master from 

engaging in U.S.-focused activities involving the infringing products other than through CMI, and that substantive dispute arises under paragraph 2 as well as 

paragraphs 3, 4, and 5. 

Different terminology has been used for the two categories of enjoinable conduct by persons not held liable. 

Judge Learned Hand wrote, for the Second Circuit, that 

the non-liable party “must either abet the [liable party], 

or must be legally identified with him.” Alemite Mfg. 

Corp. v. Staff, 42 F.2d 832, 833 (2d Cir. 1930), quoted in

Case: 16-1026 Document: 65-2 Page: 21 Filed: 12/06/2016
22 ASETEK DANMARK A/S v. CMI USA INC. 

Additive Controls & Measurement Sys., Inc. v. Flowdata, 

Inc., 96 F.3d 1390, 1395 (Fed. Cir. 1996) (Additive Controls I). Sometimes “privity” is used for the “legally 

identified” category, which covers a number of bases for 

binding a non-liable person to obligations imposed on a 

liable person; but whatever the labels, both categories are 

well established in the law and recognized as within the 

“active concert or participation” standard of Rule 65(d). 

See Golden State Bottling Co. v. NLRB, 414 U.S. 168, 

179–80 (1973); Regal Knitwear, 324 U.S. at 13–14; Merial 

Ltd. v. Cipla Ltd., 681 F.3d 1283, 1304–05 (Fed. Cir. 

2012); Aevoe, 727 F.3d at 1384 (“‘Active concert or participation’ has been interpreted to include both aiders and 

abettors of, and privies of, an enjoined party.”); Additive 

Controls I, 96 F.3d at 1394–95, 1397; Rockwell Graphic 

Sys., Inc. v. DEV Indus., Inc., 91 F.3d 914, 919–20 (7th 

Cir. 1996); G. & C. Merriam Co. v. Webster Dictionary Co., 

639 F.2d 29, 35 (1st Cir. 1980). 

The second category, which is the only one at issue in 

this appeal, is less well defined than the first. And its 

implementation by the courts has reflected a fact-specific 

approach and particular caution so as to protect the 

strong, underlying background principle shared with the 

related area of preclusion law: “‘everyone should have his 

own day in court.’” Taylor v. Sturgell, 553 U.S. 880, 893 

(2008) (quoting Richards v. Jefferson County, 517 U.S. 

793, 798 (1996)).4 But this category, included within the 

 

4 The Court in Taylor described recognized exceptions to that principle in the preclusion context, such as 

where a person in the later suit sufficiently controlled the 

litigant in the earlier suit, 553 U.S. at 893–95, and rejected a broad “virtual representation” exception, id. at 895–

904. We do not suggest that the analysis in the preclusion context is on all fours with the injunction-scope 

analysis, but the two areas share some underlying princiCase: 16-1026 Document: 65-2 Page: 22 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 23

“active concert or participation” standard, embraces at 

least two types of situations of potential relevance here.

Thus, the “legally identified” category has long covered at least some situations in which the non-liable 

person is a successor of the liable person in a relevant 

respect. See Golden State, 414 U.S. at 180 (explaining in 

the employer context that Rule 65(d)’s policy is consistent 

with imposing a predecessor’s obligation on a successor 

enterprise: “[A] bona fide purchaser, acquiring, with 

knowledge that the wrong remains unremedied, the 

employing enterprise which was the locus of the unfair 

labor practice, may be considered in privity with its 

predecessor for purposes of Rule 65(d). . . . The tie between the offending employer and the bona fide purchaser 

of the business, supplied by a [National Labor Relations] 

Board finding of a continuing business enterprise, establishes the requisite relationship of dependence” of the 

successor’s conduct on the liable person.); Regal Knitwear, 

324 U.S. at 14 (discussing successors and assigns and 

recognizing enjoinability “in appropriate circumstances” 

of “‘those to whom the business may have been transferred, whether as a means of evading the judgment or for 

other reasons’” (quoting Walling v. James V. Reuter, Inc., 

321 U.S. 671, 674 (1944)).5 This court so recognized in 

Additive Controls I, explaining that certain “successor” 

situations, involving evasive intent, are covered by the 

 

ples. See Nat’l Spiritual Assembly of the Baha’is of the 

U.S. Under the Hereditary Guardianship, Inc. v. Nat’l

Spiritual Assembly of the Baha’is of the U.S., Inc., 628 

F.3d 837, 847–54 (7th Cir. 2010) (borrowing from Taylor

and preclusion law to resolve Rule 65(d) issue).

5 As Golden State’s “dependence” language confirms, where that standard is met, the non-liable person’s 

conduct is not “wholly independent” of the liable person. 

Golden State, 414 U.S. at 180.

Case: 16-1026 Document: 65-2 Page: 23 Filed: 12/06/2016
24 ASETEK DANMARK A/S v. CMI USA INC. 

“active concert or participation” standard of Rule 65(d). 

96 F.3d at 1397; see Merial, 681 F.3d at 1304, 1305 (similar); Additive Controls & Measurement Sys., Inc. v. Flowdata, Inc., 154 F.3d 1345, 1355 (Fed. Cir. 1998) (Additive 

Controls II) (test of “substantial continuity of identity,” 

originating in “labor relations context,” “has been adopted 

as a general expression of the degree of closeness that 

Rule 65(d) requires for a non-party successor to be subject 

to the injunction”).6

Another subcategory recognized in various cases involves situations in which a party’s litigation of a case is 

sufficiently controlled by another person that the latter 

may be said to have had its day in court and on that 

ground be subject to the injunctive obligations. The First 

Circuit in G. & C. Merriam recognized that a nonparty is 

“legally identified” with a liable party, and may therefore 

itself be enjoined, if the nonparty “had such a key role in 

the [party’s] participation in the injunction proceedings 

that it can be fairly said that he has had his day in court 

in relation to the validity of the injunction.” 639 F.2d at 

37. We recognized the point in Additive Controls II, 

 

6 Additive Controls I cites Kloster Speedsteel AB v. 

Crucible Inc., 793 F.2d 1565, 1582–83 (Fed. Cir. 1986) 

(acquirer of assets of liable person), overruled in unrelated 

respect, Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH 

v. Dana Corp., 383 F.3d 1337 (Fed. Cir. 2009), and New 

York v. Operation Rescue National, 80 F.3d 64, 70–71 (2d 

Cir. 1996) (“successors” may include organizations 

through which “similarly constituted groups of individuals 

move fluidly between multiple unincorporated associations that share the same basic leadership and goals”). 

We note that, in Travelhost, Inc. v. Blandford, 68 F.3d 

958, 961–65 (5th Cir. 1995), the Fifth Circuit rejected a 

particular injunction’s coverage of an arms-length purchaser of a liable person’s assets.

Case: 16-1026 Document: 65-2 Page: 24 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 25

quoting G. & C. Merriam in explaining that the officer of 

a corporation is legally identified with a corporation if the 

officer had just such control over the corporation’s litigation. 154 F.3d at 1352. The Seventh Circuit made the 

same point in National Spiritual Assembly, relating G. & 

C. Merriam’s holding to the established principle that a 

nonparty may be “bound by a judgment if she assumed 

control over the litigation in which that judgment was 

rendered.” 628 F.3d at 852 n.4 (quoting Taylor, 553 U.S. 

at 895; citing Montana v. United States, 440 U.S. 147, 

153–54 (1979)).

In the present case the district court specifically invoked the “successor” standards when it cited the abovequoted pages of Golden State and Regal Knitwear. Asetek, 

2015 WL 5568360, at *17. And in entering the injunction, 

the district court relied on certain facts: “CMI is authorized by . . . Cooler Master to sell Cooler Master-branded 

liquid-cooling devices in the United States”; “CMI and 

Cooler Master have an exclusivity agreement where CMI 

is Cooler Master’s exclusive U.S. distributor”; and “CMI 

and Cooler Master jointly developed the infringing products.” Id. “Because of Cooler Master’s past history in 

developing the infringing products and its contractual 

relationship with CMI,” the court then concluded, “Cooler 

Master is an appropriate subject of the injunction under 

Rule 65(d)(2).” Id. at *18. 

In drawing that conclusion, the district court relied on 

this court’s decision in Aevoe. While that decision is 

instructive in various ways, it involves different facts 

from the present case in at least one respect. In Aevoe, 

the non-liable persons (the S&F Defendants) were barred 

from selling the “infringing products obtained from” the 

liable person (AE Tech). 727 F.3d at 1379–80. Here, 

Cooler Master is the supplier; it does not acquire the 

products at issue from CMI.

Case: 16-1026 Document: 65-2 Page: 25 Filed: 12/06/2016
26 ASETEK DANMARK A/S v. CMI USA INC. 

We do not decide what ultimate legal significance that 

distinction may have here. A chain of title to particular 

units is just one of a number of facts of potential relevance 

to the inquiry into the proper scope of the injunction here. 

For example, in Merial, we upheld an injunction barring 

non-party Velcera from making, using, selling, or importing certain products developed, manufactured, or packaged with the assistance or participation of the liable 

party, Cipla, even if Cipla acted only abroad. 681 F.3d at 

1289–92, 1304–05. We relied on the district court’s findings that the “multilayered relationships that linked 

Velcera and Cipla” were structured “to obfuscate illicit 

and intentional concerted action” by those parties. Id. at 

1305. Here, besides other facts, Asetek has alleged that, 

while Cooler Master may not acquire its products from 

CMI, CMI’s cooperation in modifying its exclusivity deal 

was obtained or needed in order for Cooler Master to 

engage, other than through CMI, in the U.S.-focused sales 

and related activities involving the products at issue.

We do not think it advisable to resolve the issue of the 

proper scope of the injunction here without a fuller picture of the facts described by the district court. Rather, 

we think, further proceedings are warranted before a final 

conclusion is drawn about the injunction in this case. 

Both the delicacy of the injunctive authority at issue and 

the tradition of narrow fact-dependent determinations 

whether to invoke it argue for deferring conclusions until 

the facts about the relationship of Cooler Master and 

CMI, both in their businesses and in this litigation, are 

more fully developed and their legal significance more 

fully explored. See Parker v. Ryan, 960 F.2d 543, 546 (5th 

Cir. 1992) (identifying need for further inquiry and remanding); cf. United States v. Int’l Bhd. of Teamsters, 

Chauffeurs, Warehousemen & Helpers, 964 F.2d 180, 184 

(2d Cir. 1992) (“Whether any person is bound by a judgment always depends on the precise relationship of that 

person to the underlying litigation . . . .”). 

Case: 16-1026 Document: 65-2 Page: 26 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 27

Without prejudging ultimate materiality, and without 

intending to be complete, we note some facts that either 

side or both sides of this case may find worthy of further 

development to form a full picture of whether Cooler 

Master may be “legally identified” with CMI for present 

purposes: the nature of the exclusivity relationship 

between the firms (e.g., its scope, its terminability); 

trademarks and other aspects of the two companies’ 

relations at relevant times; the origins of CMI and its 

relationship to Cooler Master; the details of and intent 

behind changes in the companies’ relations, particularly

since liability was found in this case; and the companies’ 

relationship in the conduct of this litigation, in which 

products made by Cooler Master and carrying its brand 

name are at stake, both before and after Cooler Master 

was dismissed. We do not decide the relevance or implications of such facts. Nor do we answer several related, 

potentially relevant questions: If Cooler Master needs 

CMI’s permission to itself engage in the U.S.-focused acts 

at issue, would such acts be properly viewed as taken in 

active concert or participation with CMI? Is CMI’s interest in such Cooler Master acts suggested by the fact that 

CMI itself has joined in Cooler Master’s challenges to the 

injunction’s scope on appeal, challenges whose success 

would free Cooler Master to transfer business away from 

CMI? Whether or not Cooler Master has plenary freedom 

to transfer its business away from CMI, was Cooler Master, after leaving this case, still exercising control over 

CMI’s conduct of this litigation, which concerned the 

future of Cooler Master’s products, or did Cooler Master 

simply leave its products’ fate in this litigation in CMI’s 

hands? 

Two final, related points. First, we do not think it appropriate to vacate the injunction at present. We have 

discretion pursuant to 28 U.S.C. § 2106. Leaving the 

injunction in force for a time would preserve the status 

quo that has existed for a year, appellants not having 

Case: 16-1026 Document: 65-2 Page: 27 Filed: 12/06/2016
28 ASETEK DANMARK A/S v. CMI USA INC. 

sought a stay from us. And, although we are refraining 

from drawing any conclusions, we are not convinced, on 

the present record, that the district court’s injunction is so 

unlikely to be found improper that the status quo should 

be disturbed. Accordingly, like the Fifth Circuit in Parker 

v. Ryan, 960 F.2d at 546, we choose to leave the injunction 

in place for now, and we remand for further proceedings

to determine the proper reach of the injunction, to be 

conducted in as reasonably prompt a fashion as possible.

Second, such proceedings might be unnecessary, at all 

or for a time, if Asetek chooses, in the meantime, to file a 

new injunctive infringement action against Cooler Master. In such an action, Asetek might seek a preliminary 

injunction, relying on the judgment reached after full 

litigation in the present case. We do not prejudge the 

merits of any such request, or the merits of any such 

separate suit, including any invocation by Asetek of 

privity-based issue preclusion against Cooler Master

(which is not foreclosed simply by the absence of claim 

preclusion, New Hampshire v. Maine, 532 U.S. 742, 748 

(2001)). We note only that such a proceeding might 

produce rulings that postpone the need to decide, or even 

moot, the delicate remedial issue that we here remand to 

the district court.

CONCLUSION

For the foregoing reasons, we affirm the district 

court’s denial of CMI’s motions for judgment as a matter 

of law and for new trial. We affirm the injunction except 

insofar as it reaches Cooler Master’s conduct that does not 

abet new violations by CMI. Insofar as the injunction 

reaches such conduct, we remand for further consideration in accordance with this opinion, without vacating any 

part of the injunction.

Costs awarded to Asetek.

AFFIRMED IN PART, REMANDED IN PART

Case: 16-1026 Document: 65-2 Page: 28 Filed: 12/06/2016
United States Court of Appeals 

for the Federal Circuit ______________________ 

ASETEK DANMARK A/S,

Plaintiff-Appellee

v.

CMI USA INC., FKA COOLER MASTER USA, INC., 

COOLER MASTER CO., LTD.,

Defendants-Appellants

______________________ 

2016-1026, 2016-1183

______________________ 

Appeals from the United States District Court for the 

Northern District of California in No. 3:13-cv-00457-JST, 

Judge Jon S. Tigar.

______________________ 

PROST, Chief Judge, dissenting in part. 

I respectfully dissent from the majority’s decision to 

remand this case to the district court for further proceedings regarding the injunction while keeping it in force. 

The correct course of action would be to vacate the portions of the injunction that improperly reach Cooler 

Master (who has not been found to infringe the asserted 

patents) in its own capacity.

The district court issued an injunction that included

two key provisions. The first, Paragraph (2), enjoins

certain activities of CMI—the adjudicated infringer in 

this case—“and those persons in active concert or participation” with it. The second, Paragraph (3), goes much 

Case: 16-1026 Document: 65-2 Page: 29 Filed: 12/06/2016
2 ASETEK DANMARK A/S v. CMI USA INC. 

further. It enjoins the independent activities of Cooler 

Master, an entity that was not a party to the liability 

portions of the case.1 While Paragraph (2) is proper 

under Federal Rule of Civil Procedure 65(d), Paragraph 

(3) is plainly an overreach of the district court’s authority

to issue judgments only on the disputes before it. Similarly, portions of Paragraphs (4) and (5) that impose affirmative obligations on Cooler Master related to the injunction 

are also improper.

The majority speculates about the relationship between Cooler Master and CMI but provides no basis to 

justify the district court’s injunction against Cooler Master in its own capacity. Indeed, there is none.

I 

Courts are not legislatures. We issue judgments only 

on the disputes before us that bind only the parties involved. As a consequence, it is a “general principle that a 

non-party to an action may not be enjoined in that action.” Additive Controls & Measurement Sys., Inc. v. 

Flowdata, Inc., 96 F.3d 1390, 1395 (Fed. Cir. 1996). For 

example, in Chase National Bank v. City of Norwalk, the 

Supreme Court vacated an injunction that bound “all 

persons to whom notice of the order of injunction should 

come . . . .” 291 U.S. 431, 436 (1934) (internal quotation 

marks omitted). This, in the Court’s view, “violate[d]

established principles of equity jurisdiction and procedure” because it “ma[d]e punishable as a contempt the 

conduct of persons who act independently and whose 

 

1 Several months before trial, Asetek filed a voluntary stipulation to dismiss Cooler Master with prejudice, 

which the district court granted. Cooler Master later 

intervened for the limited purpose of suspending the 

injunction against it. 

Case: 16-1026 Document: 65-2 Page: 30 Filed: 12/06/2016
ASETEK DANMARK A/S v. CMI USA INC. 3

rights have not been adjudged according to law.” Id. at 

437.

The only exception to this rule, codified in Federal 

Rule of Civil Procedure 65(d), is that an injunction may 

bind non-parties who are “in active concert or participation with” parties to the action (or the parties’ officers, 

agents, servants, employees, and attorneys) “who receive 

actual notice of [the order] by personal service or otherwise.” This exception derives from common law principles 

regarding the power of courts in equity. In Alemite Manufacturing Corp. v. Staff, another case that vacated an 

injunction covering a non-party, Judge Learned Hand 

explained as follows: 

[N]o court can make a decree which will bind any 

one but a party; a court of equity is as much so 

limited as a court of law; it cannot lawfully enjoin 

the world at large, no matter how broadly it words 

its decree. If it assumes to do so, the decree is pro 

tanto brutum fulmen, and the persons enjoined 

are free to ignore it. It is not vested with sovereign powers to declare conduct unlawful; its jurisdiction is limited to those over whom it gets 

personal service, and who therefore can have their 

day in court. Thus, the only occasion when a person not a party may be punished, is when he has 

helped to bring about, not merely what the decree 

has forbidden, because it may have gone too far, 

but what it has power to forbid, an act of a party. 

This means that the respondent must either abet

the defendant, or must be legally identified with 

him.

42 F.2d 832, 832–33 (2d Cir. 1930). In keeping with this 

rationale, Rule 65(d)’s “active concert or participation” 

condition has been interpreted to cover two general classes of non-parties: (1) aiders and abettors, and (2) those in 

Case: 16-1026 Document: 65-2 Page: 31 Filed: 12/06/2016
4 ASETEK DANMARK A/S v. CMI USA INC. 

privity with an enjoined party. See, e.g., Golden State 

Bottling Co. v. NLRB, 414 U.S. 168, 179–80 (1973). 

Here, CMI is the adjudicated infringer. Accordingly,

the district court had authority to enter an injunction 

against CMI and, pursuant to Rule 65(d), anyone in 

“active concert or participation” with CMI. For example, 

the district court can prohibit a third party from acting as 

a conduit through which CMI could sell its infringing 

products to United States customers (e.g., by operating a 

website where CMI places its products for sale or by 

acting as CMI’s distributor in the United States). The 

court exercised this authority in Paragraph (2) of the 

injunction, which is directed at “CMI USA, Inc. and its 

subsidiaries and affiliated companies (collectively defined 

as ‘CMI’), as well as CMI’s successors, assigns, officers, 

directors, agents, servants, employees, representatives 

and attorneys, and those persons in active concert or 

participation with them.” J.A. 152 (emphasis added). It 

should have stopped there.

Paragraph (3) of the injunction, however, goes much 

further. It enjoins Cooler Master—who, again, is not the 

adjudicated infringer—“from making, using, offering for 

sale or selling in the United States, or importing into the 

United States . . . the Infringing Products.” Id. Paragraphs (4) and (5) further include requirements for Cooler 

Master to, respectively, provide notice of the court’s 

judgment to persons in “active concert or participation” 

with it and provide written notice with every sale of an 

infringing product. Id. These restrictions and obligations

in Paragraphs (3)–(5) are outside of the district court’s

authority because they reach independent activity by 

Cooler Master.2

 

2 The majority states that Cooler Master is not 

challenging various aspects of the injunction against it. 

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ASETEK DANMARK A/S v. CMI USA INC. 5

A court must restrict itself to “what it has power to 

forbid, an act of a party.” Alemite, 42 F.2d at 833. As we 

have recently explained, “[c]ourts have carefully distinguished between entering an injunction against a nonparty, which is forbidden, and holding a non-party in 

contempt for aiding and abetting in the violation of an 

injunction that has been entered against a party, which is 

permitted.” Additive Controls, 96 F.3d at 1395. Thus, 

even a non-party “[h]aving a relationship to an enjoined 

party of the sort set forth in Rule 65(d) . . . does not justify 

granting injunctive relief against the non-party in its 

separate capacity.”3 Id. at 1395–96. “Unless duly summoned to appear in a legal proceeding,” one can “rest 

assured that a judgment recovered therein will not affect 

his legal rights.” Chase Nat’l Bank, 291 U.S. at 441. 

In this case, the district court dismissed Asetek’s allegations against Cooler Master with prejudice in September 2014. From that point forward, the district court had 

the power to adjudicate but one source of potential liability: CMI’s alleged infringement of the ’362 and ’764 patents. Rule 65(d) permits the district court to enjoin 

Cooler Master only to the extent Cooler Master is aiding 

and abetting CMI’s acts of infringement or can be deemed 

 

Majority Op. at 18–19. Regardless, there is no question 

that Cooler Master is challenging the portions of the 

injunction that reach it in its own capacity.

3 Our decision in Aevoe Corp. v. AE Tech Co., 727 

F.3d 1375 (Fed. Cir. 2013), is consistent. Although the 

district court in Aevoe modified its preliminary injunction 

to enjoin a non-party, we found that the modification fell 

within the “acting in concert” scope of the original injunction and, thus, was consistent with Rule 65(d). 727 F.3d 

at 1379, 1384. In addition, the modification occurred only 

after the patentee in that case had filed an amended 

complaint naming the non-party. Id. at 1379–80.

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6 ASETEK DANMARK A/S v. CMI USA INC. 

its privy. There has been no adjudication that Cooler 

Master infringes, so there is no independent activity by 

Cooler Master that the district court has the power to 

enjoin. See Additive Controls, 96 F.3d at 1395 (holding 

that an injunction against entities in their separate 

capacity “cannot be justified as an application of Rule 

65(d), since [such an injunction] does not govern [their] 

conduct solely as it relates to their activities in concert 

with an enjoined party”).

Therefore, the provisions in Paragraphs (3)–(5) of the 

injunction that reach Cooler Master in its own capacity 

must be vacated. Cooler Master should remain “entitled 

to contest [its] liability and the appropriateness of equitable relief in a lawsuit in which [it is] named as [a] 

part[y].” Id. at 1397.

II

The majority instead remands for further proceedings 

regarding the relationship between CMI and Cooler 

Master and keeps the problematic portions of the injunction in place in the interim. I disagree with that decision

for several additional reasons.

Even though the majority asserts that it is not prejudging any facts regarding Cooler Master, it implicitly 

does so. It invites continued proceedings on matters that 

were never put before a jury, based on evidence that was

largely submitted for the first time after trial. Remanding this case creates additional burdens and expenses for 

the district court and the parties, particularly given the 

majority’s request for expedited proceedings. We should 

not interfere with how the district court adjudicates 

matters in the first instance.

Moreover, to the extent Asetek seeks recourse against 

Cooler Master, it should do so through other procedures. 

If Asetek believes Cooler Master is a privy to CMI, or is

aiding and abetting CMI’s infringing activity, Asetek can 

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ASETEK DANMARK A/S v. CMI USA INC. 7

pursue a contempt proceeding against Cooler Master. As 

discussed above, Cooler Master would be subject to contempt under Paragraph (2) of the injunction for such 

activity; there is no need for Paragraph (3). And if Asetek 

wishes to enjoin Cooler Master from independently infringing its patents, it can bring a separate suit against

Cooler Master for patent infringement.4 Curiously, 

notwithstanding its remand of this case to the district 

court, the majority does not disagree. Indeed, it urges 

Asetek to pursue this alternative course.

Equally problematic is the majority’s refusal to vacate 

the injunction in the interim. Aside from its implicit 

prejudgment of certain facts, the majority only purports to 

base its refusal to vacate the injunction on the absence of 

an explicit request for a stay and on maintaining the 

status quo. But Cooler Master has asked for all that it 

needs: from the district court, it sought a stay of the 

injunction against it; and from this court, it sought vacature of the same. The status quo is no excuse to allow the

injunction to remain in force either. Notably, the majority 

does not bless the injunction wholesale—as it stands, the 

 

4 The district court’s earlier dismissal of Asetek’s 

infringement claims against Cooler Master would not bar 

such a suit, as the post-trial “evidence” that Asetek cites 

(e.g., alleged sales to the United States through Cooler 

Master websites and alleged partnership with AMD) 

involve actions that happened after the court entered 

judgment in Asetek’s favor. See J.A. 8266–67, 8478–519 

(post-trial “evidence” submitted by Asetek, dated June 29, 

2015 and August 6, 2015); see also Aspex Eyewear, Inc. v. 

Marchon Eyewear, Inc., 672 F.3d 1335, 1342 (Fed. Cir. 

2012) (“[A] party who sues a tortfeasor is ordinarily not 

barred by a prior judgment from seeking relief for discrete 

tortious action by the same tortfeasor that occurs subsequent to the original action.”).

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8 ASETEK DANMARK A/S v. CMI USA INC. 

injunction is questionable at best. To maintain an injunction while asking the district court to review it puts the 

cart before the horse. The majority’s request for the 

district court to act “in as reasonably prompt a fashion as 

possible,” Majority Op. at 28, does not fix the problem. 

III

For the reasons above, I dissent from the majority’s 

decision to remand for further proceedings regarding the 

district court’s injunction and to keep the injunction in 

force in the meantime. The proper result would be to 

vacate the injunction with respect to Cooler Master—

namely, striking Paragraph (3) and the corresponding

language in Paragraphs (4) and (5). There is no need to 

remand for further proceedings, as they are neither 

necessary nor appropriate.

Case: 16-1026 Document: 65-2 Page: 36 Filed: 12/06/2016