Wash World v. Belanger, decided March 24, 2025

Case Name and Citation: WASH WORLD INC. v. BELANGER INC., FKA PISTON OPW INC., United States Court of Appeals for the Federal Circuit, Decided March 24, 2025 (2023-1841)

Court: United States Court of Appeals for the Federal Circuit

Panel: Lourie, Prost, and Stark, Circuit Judges; Opinion by Stark, Circuit Judge.

Issue Presented: This appeal concerns whether the district court erred in its claim construction rulings, whether Wash World forfeited certain claim construction arguments by not properly presenting them to the trial court, and whether the jury's damages award for patent infringement improperly included lost profits from non-patented "convoyed sales."

Main Themes and Important Ideas/Facts:

This case revolves around a patent infringement lawsuit initiated by Belanger Inc., the owner of U.S. Patent No. 8,602,041 (the "'041 patent"), against Wash World Inc., a competitor in the car wash system manufacturing industry. The ’041 patent discloses a "Vehicle Spray Washer with Lighted Spray Arm" designed to provide visual cues for vehicle centering.

The core issues addressed by the Federal Circuit are:

1. Claim Construction and Forfeiture:

• "Outer cushioning sleeve": Wash World argued on appeal for a construction requiring the sleeve to be "soft and resilient" and capable of being "compressed and spring back into shape." The Federal Circuit found this argument forfeited because Wash World's proposed construction in the district court was materially different ("thick sleeve of extruded foam plastic that acts as a protective cushion to prevent damage"). The court emphasized that a party cannot generally change the scope of its claim construction on appeal and must fairly present the dispute to the trial court.

• Quote: "For the remaining term [out of the three Wash World asked the court to construe], we agree with the district court’s implicit construction." (referring to "dependingly mounted")

• Quote: "For two of the three terms it asks us to construe ourselves, Wash World proposes a materially different construction than it did in the district court, so Wash World’s requests come too late." (referring to "outer cushioning sleeve" and "predefined wash area")

• Quote: "[L]itigants [may not] present new claim construction disputes if they are raised for the first time after trial." (citing Conoco, Inc. v. Energy & Environ. Int’l, L.C.)

• "Predefined wash area": Wash World's appellate construction included timing-related constraints and argued that the spray arms could not move laterally, resulting in a fixed wash area for every vehicle. The Federal Circuit also found this argument forfeited because it was materially different from Wash World's district court argument, which focused on the vehicle being positioned "substantially centrally within a wash area." The court noted that Wash World never alerted the district court to its concerns about restricting lateral movement or maintaining a constant wash area.

• Quote: "On appeal, Wash World presses a more elaborate, and materially different, construction. It begins by proposing that 'the wash area inside the wash bay is defined before the vehicle enters the car wash and does not change after the vehicle enters the car wash.' These timing-related constraints were never even mentioned to the district court."

• "Dependingly mounted": While not formally construed by the district court, a dispute arose during summary judgment regarding whether this term required a direct connection between the spray arm and the carriage. Wash World argued for a direct connection, while Belanger argued against it. The Federal Circuit agreed with the district court's implicit construction that the term encompasses both direct and indirect connections. The court reasoned that the claim language does not specify a direct connection and provided an analogy of a poster taped directly to a wall versus a framed poster hung on a nail.

• Quote: "Nothing in the claim language – 'wherein the vertically oriented spray arm is dependingly mounted from the carriage so as to extend substantially vertically into the wash area for controlled travel relative to a vehicle in the area' – suggests the claim is limited to direct connections."

• Quote: "Thus, the district court was correct to conclude that claim 7 encompasses both indirect and direct connections between the spray arm and the carriage."
  

2. Damages and Convoyed Sales:

• The jury awarded Belanger $9.8 million in lost profits and $260,000 in reasonable royalties. Wash World appealed the lost profits award, arguing that it improperly included approximately $2.6 million for "convoyed sales" (sales of non-patented auxiliary products sold with the patented car wash system) without sufficient evidence of a functional relationship.

• Preservation of Remittitur Argument: Belanger argued that Wash World forfeited its request for remittitur (reduction of damages) by not explicitly requesting a specific amount in the district court. The Federal Circuit rejected this argument, finding that Wash World adequately preserved the issue by repeatedly objecting to lost profits for convoyed sales and including the specific data supporting the remittitur in its post-trial motion briefing. The court noted that the district court and Belanger were on notice of Wash World's position.

• Judicial Estoppel: The court also found that even if the remittitur argument was not fully preserved, exceptional circumstances existed to consider it, including that Belanger's own arguments in the district court confirmed its understanding of the precise amount of damages attributed to convoyed sales. The court invoked judicial estoppel, preventing Belanger from now arguing that the basis of the jury's award was unclear.

• Quote: "Given that Belanger prevailed on Wash World’s renewed motion based, in part, on Belanger’s argument that the court could identify the amount of damages the jury awarded based on convoyed sales, it would be inequitable to allow Belanger to prevail on appeal by telling us, in direct contradiction, that we cannot determine the amount of damages that were based on convoyed sales."

• Merits of Convoyed Sales Damages: The Federal Circuit agreed with Wash World that there was insufficient evidence to support lost profits for convoyed sales. To recover such damages, the patentee must prove that the patented and unpatented products constitute a "functional unit." The court found that Belanger's evidence, primarily testimony that the additional components (like dryers) were typically sold as a "package" with the patented car wash system, was insufficient to establish the required functional relationship. Selling products together for convenience or business advantage does not justify convoyed sales damages.

• Quote: "That these additional components were sold as a 'package' with the patented car wash system does not demonstrate the requisite functional relationship necessary to establish Belanger’s entitlement to the additional lost profits. To the contrary, selling the products together as a package is the exact sort of 'matter of convenience or business advantage' that does not, in and of itself, give rise to damages liability." (citing Rite-Hite)

• The court rejected Belanger's argument that the general verdict should be affirmed if there was support for any theory of damages, emphasizing that the jury's award precisely matched the bottom figure of Belanger's expert's calculations, which included convoyed sales, making it "overwhelmingly likely" that the jury adopted that entire calculation.
  

Outcome:

The Federal Circuit affirmed-in-part, vacated-in-part, and remanded the case. Specifically:

• The court affirmed the district court's judgment of infringement, upholding its implicit construction of "dependingly mounted" and finding that Wash World forfeited its arguments regarding the constructions of "outer cushioning sleeve" and "predefined wash area."

• The court vacated and remanded the damages judgment. The district court was instructed to remit the damages award by $2,577,848 (the amount attributed to convoyed sales) and enter a revised judgment of $7,482,152 in favor of Belanger.
  

Significance:

This case highlights the importance of properly preserving claim construction arguments at the district court level. It also clarifies the standard for awarding lost profits damages based on convoyed sales, emphasizing the need for proof of a functional relationship between the patented and unpatented products beyond mere convenience or business advantage. The court's application of judicial estoppel to prevent Belanger from contradicting its prior statements regarding the jury's damages calculation is also a notable aspect of the decision.

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