from the United States District Court for the Northern
District of California in No. 3:13-cv-00457-JST, Judge Jon S.
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.
Dakai Chen, Cooley LLP, Palo Alto, CA, argued for
defendants-appellants. Defendant-appellant CMI USA Inc. also
represented by REUBEN Ho-Yen Chen.
Prost, Chief Judge, NEWMAN, and TAEANTO, Circuit Judges.
TAEANTO, Circuit Judge.
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.
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
fact-specific. In this case, a determination of the propriety
of the injunction's reach would benefit from further
findings and, if sought and needed, further record
'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, fines 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 fines 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.
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:
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
a heat-exchanging interface, the heat-exchanging interface
forming a boundary wall of the thermal exchange chamber, and
configured to be placed in thermal contact with a surface of
the heat-generating 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.
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
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 Dan-mark 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
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. 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 dismissal entered on September 5, 2014.
Asetek agreed to that dismissal after CMI and Cooler Master
witnesses testified, in discovery, to Cooler Master's
exclusive-distribution arrangement with CMI for the accused
products in the United States.
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.
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 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 Dan-mark A/S v. CMI USA,
Inc., No. 3:13-cv-00457-JST, 2015 WL 5568360, at *3-12
(N.D. Cal. Sept. 22, 2015).
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 import- 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
(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-in-suit, 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.
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 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
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.
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 ...