In a recent development, tech giant Apple has filed an appeal against a decision to ban imports of its Apple Watches. The ban stems from a complaint by medical monitoring technology company Masimo, alleging patent infringement related to blood-oxygen level monitoring technology. This decision was made after the U.S. International Trade Commission (ITC) order, set to take effect on December 26, ruled in favor of Masimo, prohibiting the import and sale of Apple Watches featuring the contested technology.
U.S. Administration Declines Veto
Despite Apple’s appeal, the U.S. Trade Representative, Katherine Tai, opted not to reverse the ITC’s ban, finalizing the decision on December 26. The administration’s refusal to intervene significantly develops the ongoing legal battle between the two companies.
Apple’s Response and Legal Action
Apple released a statement on Tuesday expressing strong disagreement with the USITC decision, emphasizing their commitment to promptly returning affected watches to customers. The company has appealed to the U.S. Court of Appeals for the Federal Circuit in Washington, contesting the ITC’s ruling. Notably, the ITC rejected Apple’s request to pause the ban during the appeal process.
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Impact on Sales and Market Presence
As a result of the ban, Apple has halted sales of its Series 9 and Ultra 2 smartwatches in the United States. However, these watches are still available through various retailers, including Amazon, Best Buy, and Walmart. The prohibition does not extend to the Apple Watch SE, a more affordable model; previously sold watches are unaffected.
Masimo’s Allegations and Legal Maneuvers
Masimo has accused Apple of hiring its employees, stealing pulse oximetry technology, and incorporating it into the Apple Watch. A previous jury trial in a California federal court ended in a mistrial in May. In response, Apple filed a separate lawsuit for patent infringement in federal court in Delaware, characterizing Masimo’s legal actions as a strategic move to pave the way for its competing smartwatch.
Historical Context and Financial Implications
The ITC ruling marks the first time a presidential administration has not vetoed such a decision since 2013. Apple faced a similar situation in 2013 when President Obama’s administration overturned an import ban on iPhones and iPads in a patent dispute with Samsung. The financial implications of the ban are notable, with Apple’s wearables, home, and accessory business generating $8.28 billion in revenue during the third quarter of 2023, according to company reports.
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