Apple to Halt Apple Watch Sales Following Patent Dispute Defeat

Apple Watch Series 9 and Apple Watch Ultra 2 are going off store shelves in the US this week, following the manufacturer's loss in a major patent dispute. While the online sale of the two smartphone watches on Apple.com will be stopped on Thursday, retail locations will stop selling the watches after December 24th.

Filed by medical technology company Masimo, the patent infringement lawsuit accused Apple of copying the former's technology in making the latest versions of the Apple Watch.

Despite its repeated denial of the allegation, the International Trade Commission (ITC) found Apple to be in violation of the patent.

Apple Allegedly Copied Masino's Blood Oxygen Sensor Technology

The infringed patent in question is a blood oxygen sensor by Masimo that can also read a person's pulse rate. The pulse oximeter, which uses a light-based technology, was allegedly copied by Apple and integrated into its smartwatches without obtaining necessary licensing rights.

With Apple denying the accusations, the legal battle over whether it copied Masimo's technology has been going on for months.

In a trial held over the dispute in May, both parties failed to persuade the jury to deliver a unanimous verdict. With the panel failing to reach a joint conclusion, US District Judge James Selna declared a mistrial.

However, court documents filed during the trial did reveal that Apple previously considered acquiring Masimo, before deciding against the idea.

Though the two companies held talks in 2013 about the use of Masimo's technologies in Apple's products, it didn't lead anywhere. However, Apple did hire two executives and key engineers away from Masimo.

The latter mentioned this in its legal filings, accusing Apple of poaching its employees with the intent of illegally copying its technology.

The ITC ruled in October 2023 that Apple had infringed Masino's patent of the pulse oximeter and used the technology in most of its smartwatches since 2020.

Apple Plans to Contend the ITC Ruling

Apple, however, firmly called the ITC's findings inaccurate and has been asking President Joe Biden, who oversees the commission, to reverse the decision.

The president has 60 days to review the ruling, i.e., until December 26th before Apple Watch Series 9 and Apple Watch Ultra 2 are banned.

While Apple is preemptively halting the sales of the two smartphone watches to comply with the decision, the company is still counting on the President's intervention. This potentially explains why the company is allowing the dispute to drag on rather than entering a licensing agreement.

Apple likes to play hardball with other companies, and sometimes it helps them reach more favorable deals over things like licensing.Gene Munster, Analyst

The tech giant also submitted evidence that demonstrates how a ban on the said smartphone watches will negatively impact medical and scientific research. Apple users relying on the ECG, blood oxygen reading, and other health-related features on the watches would be affected too, the company claims.

However, Masimo CEO Joe Kiani framed the sales halt as a pressure tactic, calling Apple's infringement of its patent a deliberate one. Apple revealed that it intends to take the fight to the Federal Circuit.

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