Masimo CEO on Looming Apple Watch Ban: 'These Guys Have Been Caught With Their Hands in the Cookie Jar'

No patent trolling here at all. Pay up Apple.

“Bad artists copy. Good artists steal.”

If you’re going to throw out colloquialisms get them right…

https://www.bbc.com/culture/article/20141112-great-artists-steal

The way this has been described -- Apple pays Masimo a visit, talks about a partnership, then suddenly several key Masimo employees are working at Apple reinventing Masimo's wheel -- feels absolutely like something our Apple would do. Apple is so addicted to high margins that it's practically allergic to paying up for things it wants. Remember how they pay ARM thirty cents per chip ('https://forums.macrumors.com/threads/report-apple-pays-less-than-30-cents-in-royalties-to-arm-per-chip.2412363/')?

he said the company would be willing to "work with them to improve their product."

He keeps saying this, with emphasis on "improving their product." What he means is that Masimo doesn't license patents outright. They always require you to also enter into purchasing agreements for their chips.

Kiani is being coy here; he won't grant a license unless Apple accepts his "help" with "improving the product" (i.e., buys Masimo's chips and uses them in every watch). Apple isn't interested in this because they do not need Masimo's chips; their hardware is better because it's explicitly designed for the Apple Watch and its small form factor.

Kiani acts like a patent troll who smells money and is duplicitous and disingenuous.

why can't they just pay them a royalty per hardware device and move forward?

See above; Kiani is being coy. He's not interested in selling a license; he's interested in forcing a supply agreement of some hardware collecting dust as a requirement for the license sale.

They aren't a patent troll. They have producing products covered by said patents for years, and in a lot higher quantity than Apple does with their watches.

Suppose you throw a bunch of patents against the wall to see what sticks; a judge dismisses half of your claims offhand because they're so ridiculous. Simultaneously, the Patent Trial and Appeal Board invalidates 15 of your patents because they are bogus. In that case, you are a patent troll in my book.

But we're not reading the same book.

The ITC ruling stands with imports unless the president intervenes, which he doesn't seem to be interested in.

I've been following your replies on others regarding what is and isn't a case and what does and doesn't constitute a trial, etc., and respectfully, I think you need clarification on what's going on here.

Three cases are at play here: one before a California court that started in 2020, Apple's lawsuit against Masimo being handled in Delaware, and the ITC case.


The California case wasn't going so well for Masimo. As I've explained above, the judge outright dismissed half of the claims, most of the patents involved in the case got invalidated, and in the end, all but one juror ruled in favor of Apple. Nevertheless, since a case needs to be decided unanimously, the judge declared a mistrial, and a new date is to be set.
This case is still ongoing, and its outcome has yet to be settled (not to mention the appeals that could follow).

Masimo didn't like how that case was going, so they went to the ITC, hoping to get a more favorable outcome. The ITC is an agency that's part of the executive branch and mainly decides within the context of imports. The ITC mostly mirrored the California judge in dismissing most of Masimo's claims except for two (nearly identical) patents.

But in this country, the courts have the final say; this ITC ruling is the first step in a more extended series of steps. The next step is for the President to overrule the ITC (he's the head of the executive branch, after all), and once that period ends, Apple can appeal it with the U.S. Court of Appeals for the Federal Circuit. But they can only do that after the Presidential Review Period has ended on December 26.
From there, it goes through the regular appeals process (i.e., Court of Appeals, Supreme Court).

Then there's the case in Delaware ('https://fingfx.thomsonreuters.com/gfx/legaldocs/movakmnjlva/IP%20APPLE%20MASIMO%20PATENTS%20complaint.pdf'). During the case in California, and two years after Masimo had gained confidential documents from Apple on the Apple Watch's design and production as part of the discovery process, Masimo launched their own watch, the W1. Apple is alleging that Masimo has used these confidential documents to rush out what they consider an Apple Watch clone, and in doing so, again, as Apple alleges, Masimo has violated several of Apple's patents.

Apple's theory of the case is that Masimo used confidential documents to make the clone and is using patent lawsuits to get the Apple Watch off the market to have a better chance at capturing the market.

The Delaware case is in full swing ('https://www.courtlistener.com/docket/65593299/apple-inc-v-masimo-corporation/'), and the outcome is still up in the air.

[HR][/HR]
All in all, Masimo is looking less and less like an innocent victim here, and this whole matter is nowhere near a done deal.

I think we are in for a long ride with this drama.

Beeper and Masimo have discovered a powerful strategy for news cycle relevance.

Good to see the law applying to giant companies like Apple