Apple Eyes Long-Term Software Fix for Watch While Appealing Ban

Right before the holidays, the International Trade Commission (ITC) ruled that Apple Inc. infringed patents held by Masimo Corp., ordering the tech giant to shelf its most popular watch models in the U.S. during the busiest shopping time of the year. In Apple’s quest to appeal the decision, a federal appeals court granted the company a brief stay, which was enough to get the watches back online and in stores one day after U.S. sales halted.

Finnegan partner Smith Brittingham told Bloomberg Law that, “Apple is ‘working desperately’ to pull all available levers to try and procedurally shut down the ITC by getting a stay from somebody.”

The International Trade Commission denied Apple’s request to delay the watch ban on December 20. On December 26, however, Apple asked the Federal Circuit to weigh in on the matter. The Court agreed to lift the ban, however, it would only last for about three weeks, ending around the time of Custom’s expected Jan. 12 ruling on the redesigned products.

“Those are the two things that you’re doing all the time,” Smith said of Apple’s parallel legal and software solutions to their patent problem. “And if you’re doing your job, as Apple’s counsel clearly are, you need to try and keep them both alive. You try and win, and if you don’t win, you try and win the second way, which is keep doing business even though they issued that injunction,” he added.

Smith said any workarounds “probably can be done with software or firmware, and maybe even could be done over the air so that you could sell the ones you already have on the shelves.” Central to the patent fight is technology used to measure oxygen in a user’s blood. A forced automatic download of a software patch disabling the pulse-oximetry feature, he said, might provide Apple a path to re-activate the technology should it win its appeal.

“I think they’re doing it just as a matter of course because they can and many times companies prefer to at least try everything,” Smith said of Apple’s multi-pronged efforts. Apple might want to “keep the status quo in place until they know what Customs is going to say. Because if Customs comes back and says, ‘Actually, your new watches still infringe,’ then they’re kind of stuck—unless they come up with a new redesign—waiting out the year for the appeal, which is a whole different bag of snakes.”

If Apple doesn’t get a favorable ruling on its redesigned devices from Customs, he said, it can appeal to the US Court of International Trade. That court’s decision could ultimately also be appealed to the Federal Circuit.

An “interesting sort of hole in the system,” Smith said, “is that Masimo as the patent holder cannot appeal a decision from Customs to the Court of International Trade.” That’s because Masimo isn’t actually a party to the Customs dispute.

“If Apple gets what they want, and Masimo thinks it’s terribly wrong, they’ve got nowhere to go,” he said.

Masimo could launch a fresh ITC petition alleging Apple violated the agency’s ban, Brittingham said, but it would have to prove the approved redesigns still infringe.

“It could never end,” he said.

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