Apple has been forced to stop selling its Apple Watch in the US over claims the devices are running on stolen technology – after a federal court lifted a pause on the ban.
All Apple stores and third party retailers will be prohibited from selling the latest Series 9 and Ultra 2 models with the blood oxygen today.
The announcement means the only available Apple watch in the US will be the company’s budget SE model.
Industry experts have said that it could result in up to a $200 million revenue loss for Apple during one of its most lucrative times of year.
A ban on Apple sales was originally set to start on December 26 but was lifted temporarily a day later after Apple requested a hold for the duration of the appeals process, but that is likely to take months.
The legal proceedings only affect Apple Watch sales in the US, which accounted for 42 percent of its overall revenue from North America last year. One in three apple watches sold worldwide are sold in the US.
Apple argued it was likely to win its appeal and that keeping the ban in effect would harm the company, its suppliers and the public.
The commission countered that Apple’s arguments ‘amount to little more’ than a patent infringer ‘requesting permission to continue infringing.’
US Customs and Border Protection has said that Apple can continue selling the devices in the meantime if it redesigns and replaces the hardware – a process that could take months.
Apple has not yet described the redesign publicly, which could involve an update to the watches’ software.
According to court documents, the tech giant is planning to remove the technology from the smartwatches in question in a solution that Masimo has welcomed.
Ben Bajarin, chief executive of analyst firm Creative Strategies, said Apple likely will disable the blood oxygen features on the two models rather than stop selling them.
Reports have suggested that with Apple replacing the hardware, it will take the company at least three months to produce and ship corrected smartwatches.
Masimo accused Apple of entering discussions with it for a potential partnership in 2013, only to steal the biotech startup’s idea and poach some of its engineers to implement it.
Masimo say that they pioneered a sensor technology that consistently emits light through the skin to monitor blood oxygen saturation.
Apple’s technology shines red and near-infrared (IR) light into blood-perfused tissue.
According to the company website, Masimo, founded by Joe Kiani in 1989, holds thousands of healthcare and consumer-focused patents.
Data shows that Masimo is valued at $6.69 billion, and Kiani’s net worth is $1.3 billion.
Massimo CEO Joe Kiani is leading the lawsuit against Apple and it is reported that he has spent at least $60 million fighting Apple in court.
In October, the ITC announced its ruling, finding that the devices infringed on two patents owned by biotech company Masimo, based in California.
Apple decided to halt sales on December 18 in an effort to ‘preemptively take steps to comply should the ruling stand.’
‘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 company said in a December statement.
The ban went into effect on December 24, which then left the decision to the Biden Administration that opted not to veto a ruling on patent infringements.
It is rare for a president to veto a decision from the ITC, but Apple has benefitted from such an intervention in the past and likely had high hopes it could happen again. But the Biden Administration stayed quiet.
Apple then filed an emergency motion with the US Appeals Court in an attempt to pause the ban, which went in effect on December 28 – letting retailers restart sales.
However, the move was temporary and sales have again been halted.
A Masimo has stated on record that ‘Masimo is willing to settle and As Joe Kiani has indicated,s aying: “we believe the path forward is to have honest, good-faith discussions with Apple to explore the various ways the parties could resolve their dispute.: