Apple, confronted with a potential import ban on its lucrative line of watches, which generates billions in annual revenue, is strategically navigating its way around a recent patent infringement setback that temporarily removed the most popular Apple Watch models from the shelves during the holiday season.
Recently, the Cupertino-based tech giant secured a temporary reprieve from a federal appeals court, a mere two months after the U.S. International Trade Commission (ITC) ruled that certain Apple Watch models infringed on patents owned by medical-device manufacturer Masimo Corp. Interestingly, the court order came just a day after the affected Apple Watch Series 9 and Ultra 2 made their return to Apple’s U.S. retail stores and were set to be available online by noon Pacific time on Thursday.
This legal maneuver is just one element of Apple’s multi-pronged strategy to counter the ITC’s decision. In addition to winning a brief stay, Apple has submitted redeveloped software to a U.S. customs agency, which, if approved, could pave the way for the sale of noninfringing versions of the devices as early as January 12. Simultaneously, Apple is pursuing an appeal of the ITC ruling.
Legal expert Smith R. Brittingham IV, who leads the ITC litigation practice at Finnegan, Henderson, Farabow, Garrett & Dunner LLP, notes that Apple is diligently employing various tactics to halt the ITC’s proceedings, seeking a stay from relevant authorities.
Despite the Christmas Day deadline passing without the Biden administration vetoing the ITC’s orders, Apple remains proactive. The company has appealed to the Federal Circuit to review the ITC’s findings and has filed an emergency request to temporarily halt the enforcement of the ban until a full stay pending appeal is determined. While the ITC’s decision and import ban are currently on pause, the final resolution is pending.
The upcoming oral arguments in front of the exclusion order enforcement branch of U.S. Customs and Border Protection add another layer to Apple’s efforts. Notably, Apple’s pursuit of a software workaround is distinct from its legal battles; the ITC asserts that a positive decision from Customs would merely reinforce the court’s original ruling.
Apple fights to overturn the ban of watches
As Apple fights to overturn the ban, Nicholas Matich, a lawyer at McKool Smith PC and former acting general counsel for the U.S. Patent and Trademark Office, finds the situation “pretty unusual.” He questions Apple’s decision not to settle with Masimo, suggesting that, typically, a large company like Apple might opt for a resolution to avoid business disruption.
Matich speculates that Apple may be taking a firm stance to demonstrate to patent owners that even in the face of an injunction, they are not willing to settle. This approach seems evident in Apple’s pursuit of legal action against Masimo in Delaware district court, accusing Masimo’s W1 watch of infringement.
Despite the complexity of the situation, Apple, known for its strategic prowess, appears determined to navigate these challenges, potentially reshaping the landscape of patent disputes between tech giants and smaller competitors.