What Display Daily thinks: Apple is a formidable opponent to take on in any court case, however right you may be so, for Masimo, this is a huge win. The merits of the case? You can judge for yourself.
What’s interesting about the case is that it reflects on something that has been happening quite a lot, even if the data to support that is anecdotal, and that’s big tech companies being taken to court and having to be humbled. It really isn’t a bad thing. We handicap sports teams with luxury taxes and drafts to keep games interesting and the playing field level; we should treat industries like sports leagues and limit any one or two companies from becoming too dominant.
It’s more fun that way.
In 2024, the display industry will have to see how its own legal battles shape up. First, there’s Samsung against BOE at the USITC. Then, there’s Samsung and LG against Chinese competitors with OLED, and how both those companies will leverage their patent portfolios to mitigate the threats of competitors. The materials market is about to enter an interesting time, too, because it can play coy, and hence raise prices, on all channels as OLED adoption rises in IT products. A lot rests on Apple’s OLED display purchases here, and when there is one major channel like this, it’s always interesting to watch who gets squeezed out.
The pace of innovation seems to be heating up for next gen display technology, helped along by the massive investments in research being done in China and Korea (compared to the US and Europe they are massive). Materials development is, in all likelihood, going to increase in productivity with adoption of AI techniques. IP is going to be an interesting battleground in the coming year.
The Apple Watch Ban
Apple is appealing a US sales ban on its smartwatches, a significant part of its business generating about $17 billion a year. The appeal follows the refusal of the White House to overturn a decision made by the US International Trade Commission (ITC). The ban was imposed over a patent dispute with Masimo, a medical technology maker. This dispute centers on the blood-oxygen sensor in Apple’s watches, which the ITC found to have violated two of Masimo’s health-technology patents.
The ban affects Apple’s retail channels and the import of the devices into the U.S. but does not extend to third-party retailers. Apple’s lower-end Watch SE, which lacks the blood-oxygen feature, remains on sale. The ban also affects owners of older models (Series 6, 7, and 8) with the blood-oxygen feature, as they are ineligible for hardware repairs until the ban is lifted.
Marcelo Lamego, former CTO of Masimo sister company Cercacor, was hired by Apple in 2013 to work on health sensors for the Apple Watch. Masimo alleges Lamego took its proprietary technology for noninvasive blood-oxygen measurement to Apple. Masimo alleged that Lamego took critical technology developed at Masimo—specifically, noninvasive blood-oxygen level measurement—and transferred this knowledge to Apple. This feature was a significant factor in transforming the Apple Watch into a more health-focused device.
Lamego left Apple in July 2014 after disputes with management, and the first Apple Watch, announced three months later, did not include the blood-oxygen sensor. After leaving Apple, Lamego founded True Wearables and developed the Oxxiom, a blood-oxygen sensor, which led to another legal dispute with Masimo, resulting in a court order blocking the sale of Lamego’s product.
Apple stopped selling its Series 9 and Ultra 2 watches online from December 21 and in retail stores on Christmas Eve. However, other retailers like Buy Buy Co., Target Inc., and Walmart Inc. can continue selling these products until their existing stocks run out. The company has also developed a software update for the Apple Watch, which it believes addresses the issue.
