The Biden administration declined to veto an import ban on certain Apple smartwatches involved in a health care patent infringement case, allowing the ban to take effect.
In October, the U.S. International Trade Commission (ITC) upheld a ruling in favor of two Irvine, California-based companies, Masimo Corp. and Cercacor Laboratories, which sued Apple in 2021 over smartwatches featuring a blood oxygen sensor that can read the wearer’s pulse.
In the lawsuit brought before ITC, Masimo accused Apple of hiring away its employees, stealing trade secrets related to its light-based pulse oximetry technology and incorporating it into the Apple Watch Series 6 smartwatch released in 2020. Masimo originally sued Apple in 2020, but a jury trial on Masimo’s allegations ended with a mistrial in May.
Apple also counter-sued Masimo, claiming that Masimo was trying to use the federal authority to make way for its own competing smartwatch that “copies Apple.”
Masimo complained that the patent-infringing Apple watches were manufactured in China. Apple has since moved some of its smartwatch production to Vietnam.
The ITC decision did not specify which models of Apple Watch would be affected by the ban. Since last week, Apple has halted the sales of its Series 9 and Ultra 2 smartwatches in the United States. However, the watches remain available from other retailers such as Amazon, Best Buy and Walmart as of Tuesday.
The Biden administration had 60 days to decide whether to veto ITC’s import ban or to let the ban go into effect. On Tuesday, the Office of the U.S. Trade Representatives announced that it would not intervene.
The decision is made by U.S. Trade Representative Katherine Tai, who is responsible for reviewing and potentially lifting import bans imposed by the ITC.
Apple Appeals Ban
Apple has appealed the decision to the U.S. Court of Appeals for the Federal Circuit in Washington. It also asked the court to pause the ban at least until U.S. Customs and Border Protection decides whether redesigned versions of its smartwatches infringe Masimo’s patents. Last week, the ITC rejected the tech giant’s request to halt the ban during the appeal process.“We strongly disagree with the USITC decision and resulting exclusion order, and are taking all measures to return Apple Watch Series 9 and Apple Watch Ultra 2 to customers in the United States as soon as possible,” a spokesperson for Apple said in a statement.
In a statement released shortly after the October ITC decision, Masimo founder and chief executive Joe Kiani said the ruling “sends a powerful message that even the world’s largest company is not above the law.”
“This important determination is a strong validation of our efforts to hold Apple accountable for unlawfully misappropriating our patented technology,” he said.
The import ban does not affect the Apple Watch SE, a cheaper model that offers most of what Apple’s smartwatch has while cutting out certain features, including pulse-oximetry capabilities. Previously sold watches will also not be affected by the ban.
Presidential overrides of ITC rulings are rare. The latest such occurred in 2013, when then-President Barack Obama used his authority to overturn an import ban on certain iPhones and iPads involved in a patent dispute between Apple and Samsung.
Earlier this year, President Biden opted not to veto a similar patent infringement ruling involving Apple and AliveCor, a medical device company headquartered in Mountain View, California.
In that ruling, the ITC determined that the electrocardiogram (ECG) technology built into some Apple Watches infringes on AliveCor’s patented portable ECG devices. The decision came with an order that would stop further imports of ECG-equipped Apple Watches—spanning from 2018’s Series 4 model to the more recently introduced Series 8—into the United States, as well as a $2 bond for each of the devices imported or sold during the 60-day presidential review period.
The penalty actions are still on hold, however, since additional patent litigations exist between the two companies.
