Apple Inc. is set to release versions of its Series 9 and Ultra 2 watches in the United States without the blood oxygen feature, following a legal setback in its patent dispute with Masimo Corp.
The announcement came on Wednesday, with Apple confirming that the modified models will be available for purchase starting Thursday through its retail outlets and online store. Although the new watches will still include the blood oxygen monitoring tool, it will be non-functional.
Earlier in the day, the US Court of Appeals for the Federal Circuit rejected Apple’s request for an extended pause on an import ban imposed by the US International Trade Commission (ITC) on the devices. This ruling mandates that Apple halt the sale of watches with the oxygen measurement feature while the appeal of the ban progresses, a process Apple estimates could extend for a year or more.
In response, Apple took the unusual step of removing a pivotal feature from its devices. Last week, the US Customs and Border Protection agency approved redesigned versions of the watches lacking the capability.
“Pending the appeal, Apple is taking steps to comply with the ruling while ensuring customers have access to Apple Watch with limited disruption,” the company stated. “Apple’s appeal is ongoing, and we believe the US Court of Appeals for the Federal Circuit should reverse the USITC’s decision. We strongly disagree with the USITC decision and resulting orders.”
The company clarified that the feature remains intact on models sold outside the US, and previously purchased watches will retain the ability to check blood oxygen levels.
Masimo Corp’s shares surged by 2.1% to $122.57 following the decision, marking their highest level since August. CEO Joe Kiani hailed the development as a “victory for the integrity of the American patent system.”
The court battle poses a significant threat to one of Apple’s primary revenue streams in its home market, an unprecedented situation for the tech giant. The watches constitute a core component of the company’s wearables, home, and accessories division, a segment that generated over 10% of revenue last year, nearly $40 billion.
The ITC ruled in October that Apple’s latest watches infringe patents related to blood oxygen measurement, an aspect known as pulse oximetry. Consequently, Apple halted sales of the smartwatches just before Christmas, though an interim stay allowed the products to return late last month.
Apple contests the ITC ruling, arguing that the harm it would face from the ban is speculative rather than unquantifiable. Masimo Corp urged the Federal Circuit to reject Apple’s request for an extended delay, emphasizing that Apple had ample time to anticipate the ban.
The appeals court, in a brief order on Wednesday, stated, “We reach no conclusion on the merits of the appeal.” The temporary stay will expire at 5 p.m. Eastern time on Thursday.
Apple, headquartered in Cupertino, California, introduced the blood oxygen sensor to its watches in 2020 with the Series 6. Masimo Corp, a medical device company, filed a lawsuit against Apple that year, alleging infringement of its health technology patents and trade secrets.
The case is identified as Apple Inc. v. ITC, 24-1285, in the US Court of Appeals for the Federal Circuit.