Apple Watch ban up to Biden administration after ITC order

Masimo's patent lawsuit against Apple may end in an Apple Watch ban after an ITC order, but it's up to President Biden's administration and potential appeals that will follow.

Masimo filed a lawsuit with the US District Court in 2020 then the ITC in 2021 alleging Apple stole trade secrets and violates patents with the Apple Watch blood pulse oximeter. The ITC ruled in favor of Masimo in January, but the District Court jury trial ended in mistrial and hasn't resumed.

According to a report from Reuters, the ITC has issued an order that could result in an Apple Watch ban on products that violate Masimo's patents. While the order wasn't specific, that would likely include all models released since the Apple Watch Series 6 but not including Apple Watch SE.

The order must go through presidential review within the next 60 days. Apple will be able to appeal the decision if President Biden's administration bans the Apple Watch models from import to the US, so an actual sales ban isn't yet imminent.

"Masimo has wrongly attempted to use the ITC to keep a potentially lifesaving product from millions of U.S. consumers while making way for their own watch that copies Apple," an Apple spokesperson said. "While today's decision has no immediate impact on sales of Apple Watch, we believe it should be reversed, and will continue our efforts to appeal."

Apple previously counter sued Masimo in 2022, claiming the company sought to clear the path for its own competing smartwatch. That trial hasn't made any progress.

Another lawsuit alleges patent infringement and asks for an Apple Watch ban, but it is from a company called AliveCor. The ITC ruled against Apple in that case, but the ruling is on hold while the validity of AliveCor's patents are investigated.

It isn't clear exactly how long these lawsuits will take or what the ultimate rulings will be. Even if the ITC successfully bans specific Apple Watch models from import, Apple could have altered its designs enough in later models to prevent them from being banned.

Since the ITC hasn't specified which Apple Watch is meant to be blocked from import, Apple may only have to stop sale of a three year old device and pay fines. The best case scenario of course is overturning the verdict and preventing any kind of ban.

These cases will be going on for a long time yet. Stay tuned for more information as it arrives.

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20 Comments

x38 97 comments · 15 Years

About 1 year ago

Masimo is a publicly traded US company with a current market cap of about $4.35B. Apple reportedly has about $62.5B cash on hand. Why doesn’t Apple just buy Masimo, or at least a controlling interest in the stock, assign itself the patents in dispute, then keep or sell the rest of the company as makes sense.
Seems like it would be cheaper than all the legal costs in the end.

22july2013 3725 comments · 11 Years

x38 said:

Masimo is a publicly traded US company with a current market cap of about $4.35B. Apple reportedly has about $62.5B cash on hand. Why doesn’t Apple just buy Masimo, or at least a controlling interest in the stock, assign itself the patents in dispute, then keep or sell the rest of the company as makes sense.
Seems like it would be cheaper than all the legal costs in the end.

I like your train of thought, but Apple probably thinks that the worst case scenario would cost them less than purchasing a controlling interest ($2B). Although technically Apple could re-sell its $2B investment after giving themselves the patent to recoup some of that expense. Don't forget that the market cap probably includes the expected income from the possible win against (or settlement with) Apple, which means the company is worth less than that without a win against Apple.

darkvader 1146 comments · 15 Years

Pulse oximetry was invented in 1974. That patent is long expired Putting it in a watch is obvious, and should not be patentable.

Xed 2877 comments · 4 Years

darkvader said:

Pulse oximetry was invented in 1974. That patent is long expired Putting it in a watch is obvious, and should not be patentable.

There's a lot more to it than that. You can look at recent patents to see the trail of granted patents that lead back to 1974 and beyond.

gatorguy 24609 comments · 13 Years

22july2013 said:

x38 said:

Masimo is a publicly traded US company with a current market cap of about $4.35B. Apple reportedly has about $62.5B cash on hand. Why doesn’t Apple just buy Masimo, or at least a controlling interest in the stock, assign itself the patents in dispute, then keep or sell the rest of the company as makes sense.
Seems like it would be cheaper than all the legal costs in the end.

I like your train of thought, but Apple probably thinks that the worst case scenario would cost them less than purchasing a controlling interest ($2B). Although technically Apple could re-sell its $2B investment after giving themselves the patent to recoup some of that expense. Don't forget that the market cap probably includes the expected income from the possible win against (or settlement with) Apple, which means the company is worth less than that without a win against Apple.

While I agree Apple is rich and powerful enough to roll the dice and figure out consequences later, it's just not a good look.

It is not the first time a company has been invited to Apple to discuss a partnership on some feature, only to discover later that it was all a ruse. Apple was only interested in seeing what they came up with and how it was implemented, saving Apple time and expense deciding how to proceed without sharing the fruit.

IMHO, any company should be extremely wary if Apple reaches out to them, claiming interest in some product they have. I've had two similar though much smaller situations over the years. A certain boat manufacturer got me on the first one. Lesson learned. With the second I required money up-front and my own ND agreement for even a peek at what we had come up with.