NOTE: Pursuant to Fed. Cir. R. 47.6, this disposition is not citable as precedent. It is a public record. 

## United States Court of Appeals for the Federal Circuit

04-1526,-1537 SUNBEAM PRODUCTS, INC., Plaintiff-Appellant,

v. WING SHING PRODUCTS (BVI) LTD., Defendant-Cross Appellant.

___________________________ DECIDED: August 24, 2005

___________________________ Before RADER, BRYSON, and LINN, Circuit Judges

. BRYSON, Circuit Judge

. Appellant Sunbeam Products, Inc., appeals fr om a decision of t he United States District Court for the Southern District of New York, 311 B.R. 378, affirming in part and reversing in part a decision of the United States Bankruptcy Court for the Southern District of New York, 293 B.R. 586. Appellee Wing Shing Products (BVI) Ltd. crossappeals. 1 We affirm

.

1 The appellee is one of a family of companies under common ownership and control. We refer to them collect ively and individually as “Wing Shing.”04-1526,-1537 2 l In June 1991, John Sham, the president of Wing Shing, approached Jerry Blackwell, then a vice-president of Sunbeam ’s predecessor, a company known as Mr. Coffee. Mr. Sham offered to manufacture coffeemakers for Mr. Coffee, and he provided Mr. Blackwell with sketches of a design for the proposed coffeemaker. In response to questions from Mr. Blackwell, Mr. Sham provided a photograph of a wooden model of the coffeemaker. Between A ugust 1991 and early 1992, employees of Mr. Coffee had a series of communications with representativ es of Wing Shing regar ding the coffeemaker design. In the course of those communications, Mr. Coffee employees asked that the design be changed by (1) eliminating grooves on the brew basket; (2) eliminating ridges on the reservoir cover; (3) moving the power s witch from the base to the left column; (4) opening the brew basket from the left to righ t; (5) moving the water-level gauge from the right column to the left column; (6) insert ing a metal plate on t he bottom of the base; and (7) adding a shroud around the power swit ch. Wing Shing incorporated those changes into the design, which became known as the “AD10” model design. On June 22, 1992, Mr. Coffee entered into an agreement with Wing Shing to purchase AD10 model coffeemakers from Wi ng Shing. The agreement contained several clauses pertinent to this case. It provided that: (1) the agreement was to be effective between January 7, 1992, and Decem ber 31, 1994; (2) “[a]ny and all existing patent rights for the units or any of its component parts shall be the sole and exclusive property and/or responsibility of Mr. Coffee”; and (3) the parties would negotiate patent rights before applying for a patent on any jointly developed patentable items.04-1526,-1537 3 After the execution of the agreement, Wing Shing began to supply coffeemakers to Mr. Coffee. Unbeknownst to Mr. Coffee, on July 13, 1992, Mr. Sham filed a design patent application for the design of the AD10 coffeemaker, listing himself as the sole inventor. That patent issued on July 12, 1994, as U.S. Desi gn Patent No. 348,585 (“the ’585 patent”). Wing Shing did not mark the AD10 coffeemakers as being covered by a patent after the ’585 patent issued, however. In November 1994, Mr. Coffee informed Wi ng Shing that Simatelex Manufactory Co., Ltd., was also producing the AD10 coffeem aker for Mr. Coffee. In March 1995, Wing Shing sent a telefax message to Mr. Coffee, stating that it had no objection to Mr. Coffee transferring the AD10 tooling to Simatele x. In that same telefax, Wing Shing informed Mr. Coffee that it had a design patent on the AD10 and ther efore that it was entitled to sell the product to others. Although Wing Shing stated that the patent might result in business conflicts with Mr. Coffee, it never explicitly stat ed that Mr. Coffee was infringing the ’585 patent. Wing Shing later c onceded in the course of litigation that the March 1995 telefax did not constitute notic e of infringement of the design patent. By 2000, Sunbeam had acquired Mr. Coff ee and had dramatically reduced the volume of AD10 coffeemakers it purchased fr om Wing Shing. Wing Shing then filed a patent infringement claim against Simatele x. Although Sunbeam was in bankruptcy, Wing Shing filed a motion for relief from t he automatic stay in the Sunbeam bankruptcy proceedings. In response, Sunbeam sought enf orcement of the aut omatic stay and commenced an adversary proceeding against Wi ng Shing in the bankruptcy court. In that proceeding, Sunbeam c ontended that Sunbeam was the exclusive owner of the ’585 patent, had an indefinite exclusive lic ense to market and sell the AD1004-1526,-1537 4 coffeemakers in certain ma rkets, and had the right to choose any manufacturer to supply the AD10 coffeemaker. The bankruptcy court denied Wing Shing’s motion to lift the automatic stay and enjoined Wing Shing fr om pursuing the dist rict court patent infringement claim against Simatelex. In t he adversary proceeding, Wing Shing filed an answer to Sunbeam’s claims and counterclaim ed, asking the bankrupt cy court to enter a judgment enjoining Sunbeam fr om infringing the ’585 pat ent and awarding Wing Shing damages for past infringement. In a joint pret rial order, the parties stipulated to the issues to be tried in that proceeding, which included the issue of joint inventorship. The bankruptcy court tried the case, incl uding the issues to which the parties stipulated in the pretrial or der. At the conclusion of the trial, the court decided, inter alia , that (1) Sunbeam was not a jo int inventor of the ’585 patent; (2) Wing Shing was not barred by the doctrine of equitable estoppel from pursuing its infringement claim; (3) Wing Shing did not breach the agreement to negot iate patent rights, but even if it did, Sunbeam was barred by the stat ute of limitations from pursuing that claim; (4) Wing Shing was barred by the doctrine of lac hes from claiming damages for pre-suit infringement; (5) Wing Shing did not give S unbeam notice of infringem ent prior to filing suit and for that reason as well was barr ed from claiming damages for pre-suit infringement; and (6) Sunbeam was entitled to deduct certain expenses of its Mr. Coffee line of products in calculating its profits on the products that incorporated the infringing design. Sunbeam appealed to the district court fr om the first three rulings, and Wing Shing cross-appealed from the ot her three. The district court affirmed the bankruptcy court on all but two of the iss ues. The district court did not reach the laches issue, and04-1526,-1537 5 it disagreed with the bank ruptcy court as to the breach of contract issue, holding that Wing Shing had breached the agreement requiring it to negotiate patent rights on jointly developed patentable items. T he court concluded, however, that even though Wing Shing had breached the agreement, Sunbeam’s c ontract-based claim was barred by the applicable statute of limitations.
ll We first address whether we have juri sdiction over this appeal. Wing Shing argues that we do not have jurisdiction because Sunbeam did not assert a joint inventorship claim or a claim requiring resoluti on of a substantial question of patent law. Sunbeam responds that jurisdiction in this court is proper because its complaint sought a declaration from the court that it owned the ’585 patent or had an exclusive license based on the “course of conduct” of the parties. Sunbeam a lleged in its complaint that the design in Wing Shing’s design patent “is the same as that contained in the Mr. Coffee specifications.” Based on that allegat ion, it argues that t he “course of conduct” allegation incorporated a joint in ventorship claim into the complaint. In the alternative, Sunbeam maintains that the pretrial order, which clearly contemplated that the court would resolve the joint inventorship question, had the effect of amending its complaint to add a claim arising under the patent laws. Wing Shing counters that the pretrial order did not in fact amend the complaint to include the issue of joint inventorship. This court has jurisdiction under 28 U. S.C. § 1295 when a district court had subject matter jurisdiction under 28 U.S.C. § 1338(a). Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc. , 535 U.S. 826, 829 (2002). Sect ion 1338(a) provides subjectmatter jurisdiction if the complaint alleges a patent law claim or a claim that depends on04-1526,-1537 6 the resolution of a substant ial question of patent law. Id . at 830; see also Christianson v. Colt Indus. Operating Corp. , 486 U.S. 800, 808 (1988). We agree with Wing Shing that Sunbeam’s complaint by itself does not allege a patent law clai m or a claim that depends on the resolution of a s ubstantial question of patent law. The complaint does not even mention joint invent orship, but instead requests relief based on a contract claim. The pretrial order, however, clear ly identified the question whether Mr. Coffee employees were joint inventors of the ’585 pat ent as an issue to be tried by the court. Moreover, the pretrial order stated that “the pleadings s hall be deemed amended” to the extent necessary to allow Wing Shing to pres ent its evidence at trial first. Thus, the order, which contemplated that joint inventor ship was one of the issues in dispute, effectively amended Sunbeam’s complaint to t he extent necessary to allow orderly presentation of the stipulated issues. Under these circumstances, it is fair to interpret the pretrial order as constructively amending the complaint to add t he claim of joint inventorship. We have held that a district court “effected a constr uctive amendment of the complaint” when neither party objected to the district court adjudicating a jo int inventorship claim that was not effectively pleaded in the plaintiff’s complaint. Eli Lilly & Co. v. Aradigm Corp. , 376 F.3d 1352, 1357 (Fed. Cir. 2004). We have al so held that “[f]or the purpose of determining Federal Circuit jurisdiction, we do not differentiate between actual and constructive amendments [to the complaint].” Chamberlain Group, Inc. v. Skylink Tech., Inc. , 381 F.3d 1178, 1189 (Fed. Cir. 2004). Because we interpret the complaint, as amended by the pretrial order, to raise the pat ent issue of joint inventorship, we hold that we have jurisdiction to decide this appeal.04-1526,-1537 7 lll With respect to the issue of joint inv entorship, Sunbeam argues that because Mr. Coffee’s employees suggested changes in the Wing Shing coffeemaker, they are joint inventors of the ’585 patent as a matter of law. To support its argument, Sunbeam relies on Pannu v. Iolab Corp. , 155 F.3d 1344 (Fed. Cir. 1998), in which we stated that “[b]ecause it is undisputed t hat the invention was concei ved while Link and Pannu were engaged in a collaborative enter prise and it is furthermore undisputed that Pannu conceived significant aspects of the invention, Pannu is certai nly at least a co-inventor.” Id. at 1351. The bankruptcy cour t found, however, that “even if the Court was to give weight to the overall appearance of the Design Patent, including the well-known concepts and functional aspects proposed by Mr. Coffee, the Court finds that Mr. Coffee’s contribution to the Design Patent was not significant in quality when measured against the dimension of the full invention.” The district court upheld that finding, holding that the bankruptcy court, as fact-finder , was not clearly erroneous in concluding that Mr. Coffee employees were not joint in ventors, inasmuch as the patented design was “substantially similar” to the original version submitted by Mr. Sham, and the modified design did not contain any “invent ive concept” that was absent from the original. Sunbeam argues that the district court app lied the wrong test when it ruled that the “improved design must contain an inv entive concept.” We disagree. In Hoop v. Hoop , 279 F.3d 1004, 1007 (Fed. Cir. 2004), we stated that “minor differences between the prior art and the new claim will not suffice ” to make the person who suggested the changes that resulted in the differences an inventor. We added that the differences04-1526,-1537 8 “must be substantial and not just superficial ; the new design must contain an inventive concept.” Id . The district court therefore did not err by employing the “inventive concept” test. Furthermore, the bankruptcy court found that the Mr. Coffee employees’ contributions were not significant, c onsidering the overall appearance of the coffeemaker as well as the limited and mainly functional nature of the suggested changes. In Hoop , we also articulated the ultimate te st for design patent inventorship to be “whether the second asserted invention is ‘substantially similar’ to the first.” Id. (citations omitted). In parti cular, as a result of the changes to the design of an eagleshaped motorcycle fairing guard made by the party claiming inventorship, the new fairing design had a noticeably different visual appearance. See id. at 1006 (Figures 1 and 3). In that case, we agreed with the trial court that the party claiming inventorship was likely not an inventor becaus e the new fairing design had “strong similarities” to the drawings provided to that party by the inventor. Id. at 1008. In the present case, the changes suggested by Mr. Coffee are no more significant than thos e made by the party claiming inventorship in Hoop . Accordingly, we affirm the bankruptcy court’s ruling that Mr. Coffee was not a joint inventor of the ’585 patent.
lV Although the district court agreed with t he bankruptcy court that the Mr. Coffee employees were not joint inventors, it di sagreed with the bankruptcy court’s finding that the AD10 design was not “joint ly developed” by Wing Shing, as that term was used in the agreement. The district court therefor e concluded that Wing Shing had breached its contractual obligation to negotia te patent rights prior to fili ng a patent application on the AD10. However, both courts held that the statute of limitatio ns period began to run04-1526,-1537 9 when Wing Shing breached the contract by fili ng the ’585 patent application without first negotiating patent rights with Sunbeam in July of 1992, and that it ex pired in 1998, at least two years before this case was filed. Thus, both courts held that Sunbeam could not prevail on its contract-based claim. Sunbeam now argues, for the first time on appeal, that equitable tolling should suspend the running of the statut e of limitations. Its argum ent, however, runs afoul of the rule that arguments not m ade in the court whose order is under review are normally considered waived. See, e.g. , Caterpillar Inc. v. Sturman Indus., Inc. , 387 F.3d 1358, 1368 (Fed. Cir. 2004). Sunbeam claims that it preserved the equitable tolling argument by raising the issue in its “Reply Post-T rial Memorandum of Law” filed with the bankruptcy court. The argument that Sunbeam points to, however, was not based on equitable tolling, but instead was based on New York state law principles of claim accrual. Sunbeam argued that under New York law, a cause of action against a patentee does not accrue when the patent application is filed, but only when ownership of the patent is in disput e. Therefore, Sunbeam cont ended, “the earliest date upon which Sunbeam’s cause of action accrued was [1995], and the statute of limitations did not expire before Sunbeam fil ed the instant suit.” The bankruptcy court rejected Sunbeam’s accrual argument on t he ground that the breach of contract claim in this case was not tied to the dispute as to the patent’s ownership, but was based on Wing Shing’s alleged failure to comply with its agreement to negotiate patent rights with Mr. Coffee before filing a patent app lication. That promise, the court explained, was breached, if at all, on July 13, 1992, when Mr. Sham filed his paten t application. The04-1526,-1537 10 argument to which Sunbeam directs us is not an equitable tolling argument, and it therefore did not serve to preserve that issue for appeal. In a portion of the same brief befor e the bankruptcy court, Sunbeam made a separate argument that Wi ng Shing’s “conduct and misrepresentations” caused Sunbeam to fail to file its action in a timely fashion and that Wing Shing should therefore be estopped from relying on the statute of limitations as a defense to the breach of contract claim. The bankruptcy court, how ever, noted that Sunbeam conceded that it was aware, or should have been aware, of t he ’585 patent by March 1995 at the latest, and that Sunbeam was therefore not prevented from filing a timely action for breach of contract. Accordingly, the bankruptcy c ourt rejected Sunbeam’s “estoppel” argument. Sunbeam’s second argument is similar in some respects to the equitable tolling argument that Sunbeam makes on appeal. It differs, however, in that the estoppel doctrine invoked by Sunbeam before the bankrupt cy court requires the plaintiff to show that the action was brought wit hin a reasonable time after the facts giving rise to the estoppel ceased to be operational. See Simcuski v. Saeli , 377 N.E.2d 713, 717 (N.Y. 1978). The bankruptcy court held that Sunbeam failed to meet that burden, and Sunbeam has not challenged that finding on appeal. The estoppel doctrine that Sunbeam raised at trial is sufficiently dist inct from the argument that Sunbeam now presses upon us that we c annot agree with Sunbeam that t he equitable tolling argument was fairly presented to the tr ial court. We therefore decline to address the equitable tolling argument that Sunbeam raises for the first time on appeal. 2 Because we agree

2 We also decline to address Sunbeam ’s equitable recoupment claim, which is made for the first time on appeal.04-1526,-1537 11 with the bankruptcy court and the district court that the statute of limit ations period had expired by the time Sunbeam brought this action and because Sunbeam does not argue that it could not reasonably hav e filed its breach of contract action between the time it learned of the alleged breach (in 1995) and the time the limitations period expired (in 1998), we do not reach the ques tion whether Sunbeam was a joint developer of the AD10 or, if it was, whether Wing Shing breached its obligation to negotiate patent rights prior to filing the ’585 patent application.
V Sunbeam argues that Wing Shing should be equitably estopped from claiming that Sunbeam infringed the ’585 patent, and t hat the bankruptcy court misapplied the legal standards of equitable estoppel in this case. In order for an equitable estoppel defense to bar a patent infringem ent claim, the alleged infringer must show that: (1) the patentee led the alleged infringer to reas onably infer that the patentee would not enforce its patent; (2) the a lleged infringer relied on that conduct; and (3) the patentee suffered material injury as a consequence of that reliance. A.C. Aukerman Co. v. R.L. Chaides Constr. Co. , 960 F.2d 1020, 1028 (Fed. Cir. 1992). Sunbeam complains that Wing Shing led it to believe that Wing Shing would not enforce its patent and that it relied on that representati on to its prejudice. Sunbeam relies in particular on the March 1995 telefax in which Wing Shing stated the following, in response to Mr. Coffee’s direction to transfer tooling for the AD10 to another manufacturer: “[I]t’s a [sic] bad news to us. However, you own this tooling and we will have no objection if you decide to do so. We feel very disappointed on [sic] your suggestion. Our long term business relations hip will then be hurt badly when it really04-1526,-1537 12 happens. . . . However, the important point is that we have the pr oduct design patent of AD10 and was being filed [sic]. That means , we can sell and we will sell the same product to other customers in the same market.” Sunbeam contends that the March 1995 telefa x lulled it into believing that Wing Shing had no objection to Mr. Coffee transfe rring the production of the AD10 to another manufacturer and that it would not thereafter seek to enforce its design patent, but at most would seek to prom ote the design among Mr. Coffee’s competitors. The bankruptcy court, however, concluded that Mr. Coffee was not misled by that telefax into believing that Wing Shing would not sue for patent infringement. The court alluded to evidence, in the form of internal comm unications among Sunbeam officers noting that Wing Shing owned the design patent for the AD10, that “[i]t likely WILL be an issue if we part ways with them,” and that the design of the AD10 might have to be changed “to avoid any patent issues. TDB [sic: to be determined?].” Based on that evidence, the bankruptcy court concluded that “rather than being led to believe that Wing Shing was not going to pursue an infringement claim, Sunbeam was in fact concerned that the Design Patent might potentia lly become an issue of cont ention should Sunbeam cease doing business with Wing Shing,” and that Sunbeam even considered reworking the AD10 design to avoid a possible infringement claim. Accordingly, the bankruptcy court concluded “that Sunbeam was not misled by Wing Shing’s conduct, and that Sunbeam was aware of and had discussed internally the potential danger of a patent infringement action being brought by Wing Shing at some future date.” The district court held t hat there was sufficient evidence to support the bankruptcy court’s finding that “Wing Sh ing did not engage in conduct sufficiently04-1526,-1537 13 misleading for Sunbeam to reasonably infer t hat Wing Shing would not enforce its patent rights.” With respect to the internal Mr. Coffee communications, the district court noted that it was “clear fr om the opinion that the Bank ruptcy Court found that Wing Shing’s conduct, including the March 1995 fax fr om Wing Shing to Mr. Coffee, was not misleading and, more specifically, that Sunbeam did not rely on and was not misled by any such conduct.” Although the evidence on this point is subject to different possible interpretations, we agree with t he district court that the bank ruptcy court, as fact-finder, did not commit clear error in finding that Sunbeam was not misled into believing Wing Shing would never enforce it s patent and that the March 1995 telefax did not lead Sunbeam to believe that Wing Shing would not look to enforce its patent at some point in the future. Because equitable estoppel does not apply if the alleged infringer fails to prove the existence of bot h misleading conduct and actual reliance on that conduct, we uphold the district court’s ruling reject ing Sunbeam’s equitable estoppel defense.
Vl Wing Shing appeals from the bankruptcy court’s ruling that its failure to provide notice of infringement bars it from recoveri ng damages for infringement prior to the date suit was filed. The Patent Act provides that if a patentee does not mark the patented article, the patentee cannot recover damages unless he shows that the infringer was actually “notified of t he infringement and continued to infringe thereafter.” See 35 U.S.C. § 287(a); see also SRI Int’l, Inc. v. Advanced Tech. Labs., Inc. , 127 F.3d 1462, 1470 (Fed. Cir. 1997). The purpose of the notice requirement is to ensure that the accused infringer is aware of the patent dur ing the period in which liability arises and damages accrue. Id. Wing Shing neither marked it s coffeemakers with the patent04-1526,-1537 14 number nor provided adequate notice to Sunbeam t hat it was infringing the ’585 patent. Wing Shing argues that it gav e Sunbeam notice of infringement at a trade show in 1996 when Mr. Sham allegedly told a Sunbeam em ployee that “we have the product design patent and [Sunbeam] should not buy from anybody else, but should buy from us.” The bankruptcy court rejected Mr. Sham’s unco rroborated testimony about that alleged communication on credibility grounds. As the district court explained, the bankruptcy court “was in the best position to judge the credibility of wit nesses and determine whether testimony was credible.” Like the di strict court, we decline to upset the trial court’s credibility finding. We also agree with the district court t hat the bankruptcy court “did not commit clear error in determining that Wing Shing failed to provide constructive or actual notice to Sunbeam and, therefore, is precluded from the recovery of pre-suit claims.” Because we hold that the notice i ssue disposes of Wing Shing’s claim for presuit damages, we follow the sa me course as the district court and decline to address whether the bankruptcy court err ed in holding that the doctrine of laches also bars Wing Shing from recovering pre-suit damages.
Vll Finally, Wing Shing complains that the bankruptcy court erred in allowing Sunbeam to deduct certain fixed costs, allocated to the sales of the AD10 coffeemakers, when calculating Sunbeam’s pr ofits on the infringi ng units. The amount of damages is a finding of fact revi ewed under the clearly erroneous rule. Minn. Mining & Mfg. Co. v. Johnson & Johnson Orthopaedics, Inc. , 976 F.2d 1559, 1577 (Fed. Cir. 1992). However, certain subsidiary decisions, “such as choosing between reasonable alternative accounting methods for determini ng profit margin” are discretionary with the04-1526,-1537 15 trial court and are reviewed under t he abuse of discret ion standard. Id. ; SmithKline Diagnostics, Inc. v. Helena Labs. Corp. , 926 F.2d 1161, 1165 n.2 (Fed. Cir. 1991). In this case, the bankruptcy court found t hat some fixed costs were properly attributable to the infringing coffeemakers and other fixed costs were not. In addition, the court refused to deduct those fixed co sts that the court concluded Sunbeam had failed to show were related to the producti on of the infringing products. The court found that the fixed costs that were deductible were “directly related to the AD Coffeemakers, and that the AD Coffeemaker s could not have been brought to market without them.” While Wing Shing argues that the evidence di d not justify the cour t’s conclusion that those costs were related to the cost of selling the in fringing units, Sunbeam introduced some documentary and testimonial evidence about the various categories of expenses, and the bankruptcy court analyzed the ca tegories in question with care. Although the evidence available to the cour t on this issue was somewhat limited, we nonetheless agree with the dist rict court that there was sufficient evidence for the bankruptcy court to make a reasonable determi nation of the costs associated with the sale of the AD10 units. The court’s ruling on t hat issue was thus not clearly erroneous. We also agree with the district court that the bankruptcy c ourt made “reasonable determinations as to what categories and portions of items should be included and what costs should be deducted in calculating Sunbeam ’s profit.” Thus, the bankruptcy court did not abuse its discretion by employing a methodology that included certain cost items that Wing Shing argues should not have been deducted in calculati ng Sunbeam’s profits on the infringing products. Each party shall bear its own costs for this appeal.