Wesley Hilliard
Those hoping the White House will step in and stop an impending Apple Watch ban may need to look elsewhere, as word from the administration offers almost no information.
Apple doesn't have many options before the International Trade Commission's Apple Watch ban goes into effect on December 25. A software update could help avoid a ban or intervention from the White House, but the latter is increasingly unlikely.
According to a report from Bloomberg, the Biden administration is "tracking" the Apple Watch ban due to the Masimo patent dispute. While the President could stop a ban, the power to veto has been deferred to the US Trade Representative.
The White House Press Secretary Karine Jean-Pierre told reporters that the top US trade official Katherine Tai is "carefully considering all of the factors in this case." There is no indication if the White House intends to intervene or make any decision before the December 25 deadline.
Apple intends to appeal the Apple Watch import ban, which affects all models with the violating blood oxygen sensor first used in the Apple Watch Series 6. Since Apple only sells the latest models new, only the Apple Watch Series 9 and Apple Watch Ultra 2 are being removed from sale.
Third-party sellers with inventory of any Apple Watch can still sell them without limits. When that stock runs out, that's when US customers will be left with only used markets and the Apple Watch SE.
Apple intends to contest the ITC's decision as soon as the deadline for the White House intervention passes on December 25. There is a chance that the import ban could last through the lengthy appeals process well into 2024, but Masimo is also open to settlement.
Chip Loder
Marko Zivkovic
Christine McKee
Malcolm Owen
William Gallagher
7 Comments
"No comment" doesn't really speak to the White House's intent. The situation as described is a big game of high-stakes poker. Masimo just wants Apple to give them money, to settle. They figure the closer we get to the import ban going into effect, the higher the price they can demand from Apple, if Apple blinks. Apple may feel they're in the right and flat out don't want to settle, or at least don't want to settle if the White House could overturn the import ban, knocking out Masimo's leverage. Their announcement that they're preparing to pull the devices from shelves is an "all in" poker bet. Maybe they're bluffing, maybe they think they have the right cards. The White House of course would really prefer not to get involved. Regardless of the actual merits of the dispute, if they overrule the ban, they'll be accused of penalizing an aggrieved underdog. If they let it go through, they'll be accused of feeding a patent troll. They probably already know exactly what their decision would be, but they're waiting for a settlement to get them out of having to say.
This will probably go down to the wire on Christmas day, but that really doesn't say much about whether or not the White House will overrule the import ban or let it go into effect.
Masimo's CEO has said multiple times he is open to talk about the whole thing, but Apple is being arrogant & stubborn, and seems to think public opinion & politicians will sway things over in to their favor somehow. Apple hasn't even approached Masimo, after the CEO reached out to Apple. And it appears Masimo has the patents (hardware with software) which Apple can't get around with just software. Listening to some of the interviews with Masimo's CEO, Apple tried everything in the book, even recruiting people right out of Masimo with big salaries, thinking they could somehow get what they needed. Didn't work.
It’s clear to me after hearing Masimo’s CEO interviews that Apple is clearly in the wrong here, and they will need to play ball with Masimo if they want to retain their PulseOx features on the watches.
Apple is the gorilla in the room. They have big money and big political influence. Apple is not the squeaky clean, earth and LGBTQ friendly, wholesome company a lot of people think they are. I have no doubt they’ve appropriated IP invented by others. But the high costs to defend IP is a challenge for small companies. So Apple gets away with it. Apple is a competitive beast, but they do their best to keep that hard, rough and tumble personality out of the public eye. They don’t want to give in to Masimo’s demands because they don’t want the bad PR of having been proven to have stolen IP, they don’t want to encourage other companies who feel they’ve been wronged by Apple and certainly Apple’s corporate ego prevents them from surrendering.