Nab the Apple Watch Series 9 or Ultra 2 while you still can. After 3:00 p.m. Eastern Standard Time (EST) on 21 DEC 2023, the tech giant said it is preemptively halting sales of the devices to the United States (US), with in-store inventory available until 24 DEC 2023.
The announcement comes after the International Trade Commission (ITC) ruled in October 2023 to uphold a judge’s previous decision that found Apple had violated rights held by Masimo, a MedTech company, in light-based technology for reading blood-oxygen levels. In litigation that began in 2020, Masimo alleged the company stole its intellectual property and incorporated it in several Apple Watch models.
The October 2023 ruling in Masimo’s favor did not immediately take effect to bar Apple Watch sales to the US market. Instead, the decision is currently facing a 60-day presidential review and possible appeals. The Biden Administration’s review period expires on 25 DEC 2023, and an answer must be provided.
Of note, Presidents have rarely vetoed bans in the past. One (1) of the rare occasions in which a President decided to veto such a ban was in 2013. In that instance, President Barack Obama vetoed a ban on iPhones as part of Apples extended litigation will Samsung. After the review period, Apple also has the opportunity to appeal the ban in the US Court of Appeals for the Federal Circuit after the review period ends.
Releasing a statement to 9to5Mac, Apple confirmed the news as it waits for the Biden Administration’s decision, stating that if the decision stands, the company will pursue all available measures to return the watches affected to the US market. “A Presidential Review Period is in progress regarding an order from the U.S. International Trade Commission (ITC) on a technical intellectual property dispute pertaining to Apple Watch devices containing the Blood Oxygen feature. While the review period will not end until December 25 (2023), Apple is preemptively taking steps to comply should the ruling stand. This includes pausing sales of the Apple Watch Series 9 and Apple Watch Ultra 2 from Apple.com starting December 21 (2023), and from Apple retail locations after December 24 (2023),” according to the statement. “Apple’s teams work tirelessly to create products and services that empower users with industry-leading health, wellness, and safety features. Apple strongly disagrees with the order and is pursuing a range of legal and technical options to ensure that Apple Watch is available to customers. Should the order stand, Apple will continue to take all measures to return Apple Watch Series 9 and Apple Watch Ultra 2 to customers in the US as soon as possible.”
Currently, the ITC decision only prohibits Apple from selling the Series 9 and Ultra 2 models because both devices offer blood-oxygen monitoring capabilities. The Apple SE, which does not include the sensor, will remain unaffected and available for sale. Additionally, before the Dec. 25 cut off, the ruling only prohibits Apple from selling affected models, meaning that until the deadline, devices will remain available from other outlets like Amazon and Best Buy. If the decision is upheld by the President, after 25 DEC 2023 all imports of those devices will be blocked from the US, and the company would be prohibited from selling them to resellers.
For current Series 9 and Ultra 2 model owners, the ITC order has made an exception to the ban for the service, repair, or warranty period of devices sold before the cut off. In report from BTIG, analysts Marie Thibault and Sam Eiber digested the news, and deferred to previous discussions with patent attorney John Presper, Counse; for Foster Murphy Altman & Nicke, PC, who postulated that the most likely outcome will be that the administration takes no action to prevent the ban.
The analysts also raised questions regarding the potential for Masimo to bring forward additional litigation to obtain monetary reparations and royalties. “If the review period ends without any Presidential action, then the orders would go into effect immediately,” the analysts wrote. “We think there remains potential for [Masimo] to secure settlements, royalty payments, or other monetary-based agreements.”
REFERENCE: Medical Device and Diagnostic Industry (MDD+DI) Qmed; 18 DEC 2023; Katie Hobbins