Apple will be forced to stop selling its Apple Watch in the US tomorrow over claims the devices are running on stolen technology – after a federal court lifted a pause on the ban.
Retailers will be prohibited from selling the latest Series 9 and Ultra 2 models with the blood oxygen feature, leaving the low-end SE on the shelves.
The order comes after Apple was found to have copied patented medical technology from the California-based biotech company Massimo.
A ban on Apple sales was originally slated for December 26 but was lifted temporarily a day later after Apple requested a hold for the duration of the appeals process, but that is likely to take months.
The order is due to Massimo accusing the tech giant of stealing its technology, which has resulted in a previous ban that was lifted temporarily
The legal proceedings only affect Apple Watch sales in the US, which accounted for 42 percent of its overall revenue from North America last year.
While Apple Watch sales are far smaller than those of its iPhone, the device anchors the company’s wearables sales segment, which accounted for $39.84 billion of Apple’s overall $383.29 billion in sales for fiscal 2023.
The Cupertino-based company argued it was likely to win its appeal and that keeping the ban in effect would harm the company, its suppliers and the public.
The commission countered that Apple’s arguments ‘amount to little more’ than a patent infringer ‘requesting permission to continue infringing.’
US Customs and Border Protection determined that a proposed redesign from Apple would allow it to import reconfigured versions of the Series 9 and Ultra 2 s without violating the International Trade Commission’s (ITC) restrictions, court filings show.
Apple has not yet described the redesign publicly, which could involve an update to the watches’ software.
According to court documents, the tech giant is planning to remove the technology from the smartwatches in question in a solution that Masimo has welcomed.
Ben Bajarin, chief executive of analyst firm Creative Strategies, said Apple likely will disable the blood oxygen features on the two models rather than stop selling them.
The order is due to Massimo accusing the tech giant of stealing its technology and committing patent infringement. The lawsuit resulted in a previous ban that was lifted temporarily last month
In October, the ITC announced its ruling, finding that the devices infringed on two patents owned by biotech company Masimo, based in California.
The ban went into effect on December 24, which then left the decision to the Biden Administration that opted not to veto a ruling on patent infringements.
Apple then filed an emergency motion with the US Appeals Court in an attempt to pause the ban, which went in effect on December 21 – letting retailers restart sales.
However, the move was temporary and sales have again been halted.
Massimo CEO Joe Kiani is leading the lawsuit against Apple
A Masimo spokesperson told DailyMail.com last month: ‘Masimo is willing to settle. As Joe Kiani [CEO] indicated, we believe the path forward is to have honest, good-faith discussions with Apple to explore the various ways the parties could resolve their dispute.’
However, Apple is said to have a $17 billion rescue mission in place, in which engineers are working to tweak the algorithms that measure blood oxygen.
Details of the exact software changes are unknown, but industry experts speculate Apple will change algorithms enough to address patent violations.
However, Masimo’s patents focus on hardware, not software, which emits light on the skin to collect data on blood oxygen levels.
Masimo told Bloomberg that a software fix would be an insufficient remedy and ‘the hardware needs to change.’
Industry experts told DailyMail.com that the ban could result in at least a $200 million revenue loss for Apple during the holiday season, but now that amount is likely to increase.
Reports have suggested that with Apple replacing the hardware, it will take the company at least three months to produce and ship corrected smartwatches.
