United States Court of Appeals 

for the Federal Circuit ______________________

ATEN INTERNATIONAL CO., LTD.,

Plaintiff-Appellee

v.

UNICLASS TECHNOLOGY CO., LTD., 

ELECTRONIC TECHNOLOGY CO., LTD., AIRLINK

101, PHOEBE MICRO, INC., BROADTECH 

INTERNATIONAL CO., LTD., DBA LINKSKEY, 

BLACK BOX CORPORATION, BLACK BOX 

CORPORATION OF PENNSYLVANIA,

Defendants-Appellants

______________________

2018-1922

______________________

Appeal from the United States District Court for the 

Central District of California in No. 2:15-cv-04424-AGAJW, Judge Andrew J. Guilford.

______________________

Decided: August 6, 2019

______________________

EDWARD NAIDICH, Mei & Mark LLP, Washington, DC, 

argued for plaintiff-appellee. Also represented by LEI MEI,

RICHARD HADORN, PHILIP ANDREW RILEY, LAURENCE M.

SANDELL. 

 JOSEPH PIA, Pia Anderson Moss Hoyt, Salt Lake City, 
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

2

UT, argued for defendants-appellants. Also represented by 

ROBERT AYCOCK. 

 ______________________

Before MOORE, WALLACH, and TARANTO, Circuit Judges.

MOORE, Circuit Judge.

Uniclass Technology Co., Ltd. (“Uniclass”), as well as 

Electronic Technology Co., Ltd.; Airlink 101; Phoebe Micro, 

Inc.; Broadtech International Co., Ltd., d/b/a Linkskey;

Black Box Corporation; and Black Box Corporation of 

Pennsylvania (collectively the “customer defendants”) (all 

collectively “Appellants”) appeal the United States District 

Court for the Central District of California’s order denying 

Appellants’ motion for attorney fees. Because we hold the 

district court did not abuse its discretion in declining to 

find this an exceptional case under 35 U.S.C. § 285, we affirm. 

BACKGROUND

Uniclass and ATEN International Co., Ltd. (“ATEN”) 

are involved in making and selling keyboard-video-mouse

switch systems that allow a user to control multiple computers from a single keyboard, video device, and mouse. In 

2011, Uniclass stopped making payments on a license 

agreement it entered with ATEN in 2009. In 2014, ATEN 

sued Uniclass and the customer defendants alleging infringement, seeking damages and injunctive relief. Uniclass moved for summary judgment on ATEN’s lost profits 

theory of damages, which the district court granted in April 

2017. ATEN proceeded to trial based on a reasonable royalty theory of damages, under which its expert testified 

that the maximum recovery (not including its requested 

treble damages) was $678,337. At trial, a jury found that 

Uniclass did not infringe the asserted claims of U.S. Patent 

No. 8,589,141 or U.S. Patent No. 7,640,289. It also found 

the asserted claims of the ’141 patent invalid. ATEN 
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

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appealed various aspects of the September 2017 jury verdict separately in No. 18-1606, which we also decide today.

After trial, Uniclass moved to declare this case exceptional under 35 U.S.C. § 285, arguing that ATEN did not 

conduct an adequate pre-filing investigation, unnecessarily 

increased the costs of claim construction, drastically increased discovery costs by frequently changing counsel and 

infringement positions, and engaged in unreasonable litigation behavior requiring additional motion practice and 

leading to an expensive and disproportionate trial. The 

district court denied the motion.

Uniclass timely appealed. We have jurisdiction under 

28 U.S.C. § 1295(a)(1).

DISCUSSION

Under § 285, “[t]he court in exceptional cases may 

award reasonable attorney fees to the prevailing party.” 

“[A]n ‘exceptional’ case is simply one that stands out from 

others with respect to the substantive strength of a party’s 

litigating position (considering both the governing law and 

the facts of the case) or the unreasonable manner in which 

the case was litigated.” Octane Fitness, LLC v. ICON 

Health & Fitness, Inc., 572 U.S. 545, 554 (2014). District 

courts should determine whether a case is exceptional on a 

case-by-case basis, considering the totality of the circumstances. Id. We review the district court’s § 285 determination for abuse of discretion. Highmark Inc. v. Allcare 

Health Mgmt. Sys., Inc., 572 U.S. 559, 561 (2014). “The 

abuse-of-discretion standard does not preclude an appellate court’s correction of a district court’s legal or factual 

error: A district court would necessarily abuse its discretion if it based its ruling on an erroneous view of the law or 

on a clearly erroneous assessment of the evidence.” Id. at 

563 n.2 (internal quotation marks omitted). 
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

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I

Appellants focus their arguments on appeal on a theory 

that the district court erred in not finding this case exceptional based on ATEN’s disregard for the “foundational policy” of proportionate litigation. Appellants’ Br. 15–16. 

Appellants summarize ATEN’s expenses as including over 

$700,000 in expert witness fees alone, without considering 

other expenses including attorney fees. Appellants argue 

that ATEN could recover, at most, $678,337 in reasonable 

royalty damages. See J.A. 902 at 7:20–8:4; J.A. 870 at 

23:8–11; J.A. 923 at 90:14–15. Accordingly, Appellants argue this case is exceptional because the cost of litigating 

the case exceeded ATEN’s potential recovery at trial. See, 

e.g., Appellants’ Br. 15–20, 25–26. We reject this argument. We see no error in the court’s legal analysis and no 

clear error in its fact findings.

There is no per se rule that a case is exceptional if litigation costs exceed the potential damages. The District of 

Delaware’s post-Octane decision in EON is persuasive on 

this point: “[The court] is unaware of any de minimis exception for infringement. It cannot be the case that a plaintiff may be subjected to monetary sanctions for failing to 

drop a case against a defendant if the cost of litigation exceeds the potential recovery.” EON Corp. IP Holdings, 

LLC v. FLO TV Inc., No. 10-812-RGA, 2014 WL 2196418, 

at *2 (D. Del. May 27, 2014). Litigation strategies motivating a patent suit are many, with monetary damages being 

one. We routinely hear cases in which damages are not at 

issue—for example, in appeals from the International 

Trade Commission, in some Hatch-Waxman cases, and 

other cases where only an injunction is sought. A patentee 

may also bring suit to deter other competitors from infringement, encourage licensing, or test a patent’s ability 

to withstand validity challenges. Thermolife Int’l LLC v. 

GNC Corp., 922 F.3d 1347, 1363–64 (Fed. Cir. 2019).
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

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Moreover, ATEN sought injunctive relief against Uniclass, its direct competitor. This alone undermines Appellants’ argument. The case could have proceeded to trial 

requesting only an injunction, and there would be no potential damages to compare to ATEN’s expenses. We cannot conclude that the district court’s decision denying 

Appellants’ motion for fees under these circumstances 

amounts to an abuse of discretion.

Appellants argue the district court should be bound by 

its statements during trial that the court was troubled by 

disproportionate aspects of the case. But Appellants admit 

that such comments were largely directed to the amount of 

public resources expended on the limited recovery at issue. 

Appellants’ Br. 17–20 (citing J.A. 955 at 12:16–20 (regarding public resources); J.A. 1052 at 73:19–25 (regarding 

time spent with one witness); J.A. 1053 at 80:17–22 (regarding the length of trial compared to damages at issue); 

J.A. 1153 at 102:15–25 (regarding ATEN’s attorney fees

and the amount of time spent with the witness)). Appellants cite an exchange in which the court recognized a scenario in which expenditures might understandably exceed

recovery: “I just don’t understand [expert expenditures of] 

$400,000 in a $650,000 case. When I was a lawyer, if I did 

that, I would be fired, or frankly, I’d be working for a client 

who said: They are competitors. Spend every penny.” Appellants’ Br. 18 (citing J.A. 956 at 13:2–6 (emphasis 

added)). We cannot conclude that the court’s comments 

during trial regarding public resources render its subsequent decision denying fees an abuse of discretion. We see 

no abuse of discretion in the court’s conclusion that under 

the totality of the circumstances this litigation was not exceptional.

II

Appellants also argue the district court erred by failing 

to weigh ATEN’s frivolous damages methodology in its 

analysis. Specifically, Appellants argue the district court 
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

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should have weighed the strength of ATEN’s lost profits 

theory (rejected at the summary judgment stage), which 

Appellants allege was knowingly baseless and brought in 

bad faith. Appellants’ Br. 22–25. 

The district court did refer to Uniclass’ argument that 

ATEN presented a weak case for lost profits that relied on 

guesswork, which it listed among the “whole slew” of Uniclass’ arguments it considered. J.A. 3. The district court

found there were “perhaps . . . shortcomings” in ATEN’s positions that did not “amount to a showing that [ATEN’s] 

behavior was exceptional, amounting to the type of unreasonableness discussed in Octane.” J.A. 4. 

Though ATEN’s lost profits theory was not strong 

enough to withstand summary judgment, “[a] party’s position . . . ultimately need not be correct for them to not 

‘stand[ ] out.’” SFA Sys., LLC v. Newegg Inc., 793 F.3d 

1344, 1348 (Fed. Cir. 2015) (quoting Octane, 572 U.S. at 

544). The district court “had no obligation to write an opinion that reveals [its] assessment of every consideration.” 

Univ. of Utah v. Max-Planck-Gesellschaft, 851 F.3d 1317, 

1323 (Fed. Cir. 2017). We can find no abuse of discretion 

in the district court’s failure to discuss the strength of 

ATEN’s lost profits theory. 

III

To the extent Appellants argue weakness in ATEN’s 

other substantive positions justifies reversing the district 

court’s determination that this case was not exceptional, 

we do not agree. Today in No. 18-1606, we reverse the district court’s denial of JMOL because the jury’s finding of 

anticipation was not supported by substantial evidence. 

Though we affirm as to noninfringement of the ’141 and 

’289 patents, we note that ATEN’s primary argument on 

appeal—that the court improperly gave claim construction 

disputes to the jury—was rejected because ATEN did not 

timely raise this issue with the court below. We find no 

abuse of discretion in the district court’s determination 
ATEN INTERNATIONAL CO., LTD. v. UNICLASS TECHNOLOGY

CO., LTD.

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that ATEN’s positions were not so objectively unreasonable 

or exceptionally meritless as to stand out from other cases. 

We have considered Appellants’ other arguments and 

find them without merit.

CONCLUSION

We hold the district court did not abuse its discretion 

in declining to find this an exceptional case under 35 U.S.C. 

§ 285. For the foregoing reasons, we affirm.

AFFIRMED

COSTS

Costs to ATEN.