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1 year ago
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Apple Watches could soon be banned from being imported to the US after a stunning ruling from a trade court - that could make the popular devices a collectible after the holidays.
Last week, the United States International Trade Commission issued a 'limited exclusion order' on certain Apple Watches that will eventually ban the smartwatch imports.
The import ban and cease and desist on sales of Apple Watches - which dominate 60 percent of the smartwatch market, according to Counterpoint Research - is set to take effect on December 26.
President Joe Biden could prevent the ban that would take a chunk out of Apple's estimated $14billion to $18billion in yearly watch revenue, but it would be an unusual step to override the trade court's decision.
The trade court upheld a ruling from January that Apple violated Masimo's patent on light-based technology for reading biomarkers such as blood-oxygen levels.
The ruling means Apple will have to stop selling watches, except for the SEO model, on Christmas.
In September, Apple launched the Apple Watch Series 9. The United States International Trade Commission issued a ban that could see the smartwatches banned shortly after the holidays
Masimo (left), a global medical technology company, has said Apple (right) violated its patent on light-based technology for reading biomarkers like blood-oxygen levels
'[The] ruling by the USITC sends a powerful message that even the world's largest company is not above the law,' Joe Kiani, Founder, Chairman, and CEO of Masimo in said a statement.
'This important determination is a strong validation of our efforts to hold Apple accountable for unlawfully misappropriating our patented technology.'
The iPhone maker has said it plans to appeal the order in federal court.
'Our teams work tirelessly to create products and services that empower users with industry-leading health, wellness and safety features,' said Apple.
'Masimo has wrongly attempted to use the ITC to keep a potentially lifesaving product from millions of US consumers while making way for their own watch that copies Apple.'
Apple has rejected Masimo's claims and said it respects other companies' intellectual property.
Masimo, a global medical technology company, first complained in 2021 that the Apple Watch Series 6, released in 2020, and all subsequent models use technology that infringed on its blood-oxygen sensor patent.
In September, the tech giant launched the Apple Watch Series 9 that features a touchless ability to answer calls, take a photo with Camera Remote, and snooze alarms - users tap their index and thumb together to perform these tasks.
The watches range in price from $399 to $699.
President Joe Biden could also step in and reverse the ruling. But presidents rarely overrule nonpartisan agencies
It uses machine learning to detect tiny changes in blood flow when the user taps their fingers together, freeing up the other hand for other tasks like walking a dog or holding a cup of coffee, said Apple Chief Operating Officer Jeff Williams.
According to The New York Times, Masimo alleged rather than buy a license for the technology, Apple strategically hired more than 20 employees from the competing company.
The trade court's ruling means Apple will have to stop selling all watches except the SE model on Christmas. But, the sides could reach a deal that would allow Apple's use of the tech.
President Biden could also step in and reverse the ruling. But, presidents rarely overrule nonpartisan agencies, the Times noted.
Apple earned roughly $14billion to $18billion in revenue during 2022 from watch sales, as part of its wearable and accessories division, according to Business of Apps.
In May, a California judge declared a mistrial in another Masimo's trade secret lawsuit against Apple after a jury failed to reach a unanimous verdict.
Separately, Apple has sued Masimo for patent infringement in a Delaware federal court. The company has claimed Masimo is trying to clear a bath for its own smartwatch.
