Patent Dispute for Apple’s New Watch Series Continues
Introduction
In light of a patent dispute with technology company Masimo, Apple had to pause the sales of two of its new watch models in the US. The clash centres around the patented technology which is integral to the blood oxygen feature in the Series 9 and Ultra 2 watches. The US International Trade Commission (ITC) upheld the order in October and Apple took pre-emptive steps to comply with the decision despite contesting it.
The following article explores the nuances of this patent dispute and examines the repercussions on Apple’s sales, Apple’s legal response and the broader market context influencing both Apple and Masimo.
The Pause in Sales
In a recent case of Apple versus Masimo, the court’s judgement led to Apple’s temporary halt in the sales of two new watch models in the US. This dispute stems from an ongoing patent infringement issue concerning the technology responsible for measuring blood oxygen on electronic devices. This technology is currently under the rights of tech company, Masimo.
The ITC upheld the order in October, prompting Apple to review its options. Until 25 December 2023, President Biden's expected scrutiny of the decision added a layer of anticipation. Despite this, Apple expressed its commitment towards compliance if the decision was to be upheld.
Ryan Reith, a key industry figure, pointed out that even if the decision stands, the impact on Apple's sales is likely to be felt mainly in January and February – traditionally, slow months for the tech giant. Additionally, as these watches only face an import ban in the US, sales will continue in other countries. Therefore, it remains to be seen how significantly the ban will impact Apple’s sales.
Market Dynamics and Context
With a quarter of the global smartwatch market under its belt, Apple is a significant market force. Its position strengthens during the holiday seasons when, according to company reports, its market share increases to one-third.
This dispute is not an isolated incident in Apple's history. Dating back to 2013, the Obama administration vetoed an ITC ruling on an import ban concerning Apple's iPhones and iPads in relation to a patent dispute with Samsung.
In February 2023, a separate import ban on Apple Watches, prompted by patent infringement complaints from medical technology company AliveCor, was placed on hold by the ITC for reasons beyond the patent issue. Despite the pulse oximeter feature being introduced in Apple’s Series 6 model in 2020, the current patent discord further underscores the persistent challenges faced by Apple in navigating IP-related controversies.
Legal Manoeuvres and Responses
In response to the import ban decision, Apple appealed and urgently requested the US Court of Appeals for the Federal Circuit to intervene. This move aims to pause the ban until US Customs and Border Protection decides whether redesigned watches infringe Masimo's patents. Despite these efforts, the ITC rejected Apple's request to pause the ban during the appeal and opposed involving the Federal Circuit.
However, the US Court of Appeals has temporarily halted the import ban on Apple's smartwatches. While the court considered Apple's request for a more extended pause, it set a deadline of 10 January for the ITC to respond. Analysts such as Dan Ives from Wedbush Securities, see the court's temporary suspension as a significant win for Apple.
Conclusion
The legal moves and market responses emphasise the high stakes, with both Apple and Masimo navigating complex terrain in the world of patent disputes. With potential appeals and market uncertainties expected, the coming months are to be significant for both tech giants.
By Adham Shaker