Apple files emergency request to halt Watch ban
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Apple filed an appeal Tuesday to the International Trade Commission's decision to ban U.S. sales of Watch Series 9 and Watch Ultra 2 models.
Why it matters: Apple continues to be the largest smartwatch seller in the world and while the company saw a decline in revenue last quarter, it also touted 2 billion active devices, which Tim Cook attributed to "a lot of first-time buyers in the case of the Apple Watch."
Driving the news: The emergency request came after the U.S. trade representative's office said in a statement that it has declined to overturn the ban, which has now gone into effect.
- "Apple is asking only for a short stay while this Court resolves its broader request," the appeal reads.
- The failure to intervene means the sales pause is now fully in effect until the intellectual property dispute is resolved.
Catch up fast: Masimo, a medical device company that also produces fitness-tracking smart watches, claims that Apple's blood oxygen sensor infringed Masimo's intellectual property — specifically, its pulse oximetry technology.
- After the USITC ruled in favor of Masimo in October, Apple had two months to either work out a licensing agreement with Masimo or appeal the order to the Biden administration, which could reverse it, according to the New York Times.
What they're saying: The USITC said in a statement that U.S. Trade Ambassador Katherine Tai decided not to reverse the finding that Apple infringed two patents owned by Masimo Corporation and Cercacor Laboratories and noted that its decision became final on Dec. 26.
Meanwhile, a Masimo spokesperson said in an emailed statement on Tuesday afternoon that the USITC's decision "marks a significant moment for the U.S. as a defender of innovation and a protector" of inventors' rights.
- "This is a win for the integrity of the U.S. patent system, and ultimately American consumers who will benefit from an ecosystem that rewards true innovation," the spokesperson added.
The other side: "We strongly disagree with the USITC decision and resulting exclusion order, and are taking all measures to return Apple Watch Series 9 and Apple Watch Ultra 2 to customers in the U.S. as soon as possible," a spokesperson from Apple told Axios.
Between the lines: Third-party sellers are allowed to sell down their existing inventory of the watches and both of the affected watches are available for purchase outside of the U.S.
What to watch: Apple is likely to try to tweak the affected models to continue selling the watch while avoiding the patent issues. It's unclear whether Apple can make these tweaks via a software update or if it will require hardware changes.
Editor's note: This article has been updated with comments from an Apple spokesperson.
