A recent prohibition on the importation of Apple’s sought-after Apple Watches into the United States has prompted inquiries into its repercussions for consumers and the future trajectory of Apple.
The Reason Behind the Ban
The US International Trade Commission (ITC), a federal agency specialized in managing international trade disputes, enacted the ban following a complaint from Masimo, a company in the field of medical monitoring technology. The ITC concluded that a feature on the Apple Watch designed to read blood-oxygen levels encroaches upon Masimo’s pulse oximetry patents.
Despite having a 60-day window to veto the order based on public policy concerns, the administration of President Joe Biden opted not to do so.
Impact on Sales of Apple Watches in the US
Apple, headquartered in Cupertino, California, proactively suspended the sales of its latest high-end Series 9 and Ultra 2 models before the Christmas Day deadline. Notably, the ban does not extend to the lower-priced Apple Watch SE, which lacks pulse-oximetry capabilities.
While the ITC’s ruling specifically targets Apple Watches featuring the disputed pulse oximetry capability, it does not explicitly specify the affected models. In response, Apple discontinued the replacement of out-of-warranty watches from Series 6 due to the ban.
Allegations Against Apple
Masimo alleges that Apple engaged in employee poaching and technology theft following initial collaboration discussions. A mistrial in May occurred in the jury trial regarding Masimo’s accusations, and Apple countered with patent infringement claims in Delaware federal court.
Available Courses of Action for Apple
Apple intends to challenge the ban by appealing to the US Court of Appeals for the Federal Circuit in Washington. The ITC dismissed Apple’s request to halt the ban during the appeals process on December 20.
Additionally, Apple is reportedly in the process of implementing software modifications to enable its watches to function without infringing on Masimo’s patents. However, Masimo maintains that its patents encompass hardware, and a software remedy may not be sufficient.
CEO of Masimo, Joe Kiani, has expressed openness to settling the ongoing dispute.
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