Ubuntu – If external display is connected {“Lid is closed : Do nothing” } else{ “Lid is closed: Suspend” }

I believe this is a bug, and the only solution is to set your options to "Do Nothing".

Quite simple really

go to System Settings Then click on Power Settings

Set the When the Lid is Closed options to Do Nothing

You can now close your lid and your laptop will not shutdown.

If your external monitor goes black just move your mouse or click mouse button and it should turn back on, and your external monitor will now be your primary display.

PS. You should also file a bug report for this issue.

This related answer might be helpful:

• Wake up from suspend using wireless USB keyboard or mouse (for any Linux Distro)

You don't mention if your keyboard is wired or wireless. The basic steps are:

grep . /sys/bus/usb/devices/*/power/wakeup

And then (assuming 8 ports are returned) use:

sudo su
echo enabled > /sys/bus/usb/devices/usb1/power/wakeup
echo enabled > /sys/bus/usb/devices/usb2/power/wakeup
echo enabled > /sys/bus/usb/devices/usb3/power/wakeup
echo enabled > /sys/bus/usb/devices/usb4/power/wakeup
echo enabled > /sys/bus/usb/devices/usb5/power/wakeup
echo enabled > /sys/bus/usb/devices/usb6/power/wakeup
echo enabled > /sys/bus/usb/devices/usb7/power/wakeup
echo enabled > /sys/bus/usb/devices/usb8/power/wakeup
exit

See the accepted answer for all the steps.