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Apple Temporarily Suspends Certain Watch Sales in the US

Sales and Imports Ban Set for End of December
A regulatory decision set to come into force on 26 December will prohibit the sales and imports of watches equipped with the contested blood oxygen feature.

Apple’s Quick Response
In response, Apple has revealed its intention to challenge the ruling. However, as a precautionary measure, the tech giant will delist the devices from its US online store on 21 December. Physical stores in the US will follow suit post-Christmas Eve.

It’s worth noting that this restriction applies only to the US market. An official statement from Apple emphasized their stance, stating, “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.”

The Root of the Conflict
The controversy traces back to a disagreement with California-based medical device companies, Masimo and its spin-off, Cercacor. They have levied allegations against Apple, accusing the tech behemoth of headhunting their essential personnel and illicitly adopting their technology designed for blood oxygen monitoring.

Interestingly, many iterations of Apple’s smartwatches, such as the Series 9 and Ultra 2, integrated this technology since 2020. However, the SE model notably omits this feature.

Past Rulings and Responses
Last October, the International Trade Commission in the US sided with Masimo, acknowledging Apple’s infringement on certain patent rights. Consequently, the commission issued a directive against specific Apple imports. Masimo’s chief, Joe Kiani, commented on the ruling, stating it underscores a “powerful message that even the world’s largest company is not above the law.”

However, before this decision becomes final, it awaits a 60-day review by the US president, who holds the authority to overturn it. While such interventions are infrequent, a notable instance was in 2013 when former President Barack Obama intervened in a separate Apple dispute.

Apple’s Countermeasures
Not stopping at appealing the International Trade Court’s verdict, Apple intends to seek a stay order on the directive during the appeal process. This ongoing disagreement is just one facet of a broader legal tussle with Masimo concerning the oxygen-monitoring technology. To further complicate matters, Apple has filed its counterclaims, accusing Masimo of patent violations.

Previously, a jury trial addressing Masimo’s allegations of technology theft against Apple resulted in a deadlock earlier in the year.

Market and Financial Implications
Upon the announcement of this development, Apple’s stock experienced a marginal dip of over 1%. Nonetheless, industry analysts opine that the timing of this decision won’t significantly impede the company’s holiday sales momentum.

For context, Apple’s wearables division, encompassing the Watch, contributed approximately $40 billion, which equates to roughly 10% of the company’s total sales in the fiscal year ending 30 September.

by Paul Britton

Full-time CBG author covering everything from business to wellbeing news, in Cyprus. and abroad.

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