Apple Modifies Watch Models Amid Legal Battle, Removes Blood Oxygen Feature in US Sales
Apple Inc. is set to release modified versions of its Series 9 and Ultra 2 watches in the US, omitting the blood oxygen feature. This move follows a legal setback in Apple’s patent dispute with Masimo Corp., where the US Court of Appeals for the Federal Circuit declined to extend the import ban pause imposed by the US International Trade Commission (ITC). The modified watches, still equipped with the blood oxygen monitoring tool, will render the feature non-functional.
Legal Setback and Import Ban:
- The US Court of Appeals rejected Apple’s request for a prolonged pause on the import ban of its Series 9 and Ultra 2 watches, leading to the removal of the blood oxygen feature.
- Apple had sought to continue selling the watches during the appeal process, which the court declined, potentially affecting sales for a year or more.
Altered Watch Models:
- Apple will launch tweaked models of the Series 9 and Ultra 2 watches on Thursday, excluding the functionality of the blood oxygen measurement feature.
- The modified watches aim to comply with the import ban while Apple’s appeal is ongoing. The company believes the Federal Circuit should reverse the USITC’s decision and disagrees with the ruling.
Global Availability of Blood Oxygen Feature:
- While the blood oxygen feature will be disabled in watches sold in the US, Apple asserts that the feature remains available on models sold outside the country.
- Existing users who previously purchased the watches will retain the ability to check blood oxygen levels.
Financial and Legal Implications:
- The legal dispute with Masimo Corp. centers around patent violations related to blood oxygen measurement, impacting one of Apple’s major revenue streams.
- Apple’s wearables, home, and accessories division, which includes the watches, contributed over 10% of the company’s revenue in the previous year.
Market Reaction and Masimo’s Perspective:
- Masimo’s shares rose by 2.1% following the court decision, reaching their highest level since August. The company’s CEO, Joe Kiani, views the decision as a “victory for the integrity of the American patent system.”
- Masimo emphasizes the importance of upholding intellectual rights and suggests that even large companies must respect inventors’ rights.
Background of the Legal Battle:
- The ITC ruled in October that Apple’s watches violated patents related to pulse oximetry (blood oxygen measurement), leading to a temporary halt in sales just before Christmas.
- Apple argues that the harm it faces from the ban is speculative, and the ITC ruling is erroneous and should be reversed.
Future Legal Proceedings:
- Apple’s appeal against the import ban is ongoing, with the Federal Circuit yet to reach a conclusion on the merits of the case.
- The temporary stay will expire on Thursday at 5 p.m. Eastern time.
Apple’s decision to release modified watch models without the functional blood oxygen feature in the US is a response to the legal challenges it faces. The ongoing dispute with Masimo Corp. has significant financial implications, and Apple aims to navigate the situation while maintaining customer access to its watches. The outcome of the appeal and the broader impact on the wearables market will be closely watched in the coming months.
