Apple Watch Patent Trial to Turn on Storytelling, Not Sensors

A California jury begins hearing arguments Tuesday in the years-long clash between Apple Inc. and Masimo Corp. over whether Apple Watch health-sensor features infringed a Masimo patent—a fight that partly turns on whether the device is wellness tech or medical equipment.

The trial in the US District Court for the Central District of California centers on an expired patent covering blood-oxygen and heart-rate monitoring technology. Jurors will decide whether Apple infringed Masimo’s US patent No. 10,433,776 and whether the patent is valid.

If Masimo prevails on both, jurors will consider damages, which the medical-devices maker says could reach $981 million for alleged infringement from January 2020 through the patent’s expiration in June 2022.

Though this phase involves a single expired patent and a slice of past sales, its outcome feeds a much broader war over control of the fast-growing wearables-health market—a fight shaping where billions in future device and digital-health revenue may flow.

But this dispute “isn’t really about pulse-oximetry patents,” said Stacey Lee, a professor of practice in law and ethics at Johns Hopkins Carey Business School. It’s a trial over whose consumer narrative will prevail. Apple aims to “redefine the boundaries” between casual consumer technology and regulated space around medical devices, she said.

“If Masimo successfully positions Apple Watch as a medical device using their technology, they win,” Lee said. “If Apple successfully positions it as consumer wellness tech that happens to have sensors, they win.”

Battlefronts

Apple contends that thousands of its engineers independently developed the health features and that the Apple Watch doesn’t qualify as a “patient monitor.” The tech giant argues Masimo is trying to stretch its intellectual property beyond what the patent actually covers.

This courtroom battle is just one front: Masimo awaits a trade-secret bench ruling from Judge James Selna, is challenging a US Customs and Border Protection decision allowing imports of redesigned Apple Watches, and is defending an import ban it won at the US International Trade Commission that’s under review at the US Court of Appeals for the Federal Circuit.

The companies have also launched more than 50 administrative patent challenges against each other since 2020, said Saurabh Vishnubhakat, a professor and director of the IP and Information Law Program at the Cardozo School of Law.

This trial’s scope “is limited to the infringement of one expired patent,” said Christine Lehman, a managing partner at Reichman Jorgensen Lehman & Feldberg LLP. If Apple loses, she said, “it will be a matter of a damages award that Apple will likely appeal.” But she said the still-pending trade-secret ruling “might finally bring this saga to an end.”

Sparring Over Experts

Inside the courtroom, expert credibility and narrative clarity may matter as much as the underlying engineering. Selna recently barred an Apple-retained emergency physician from testifying about patent meaning, finding those interpretations require qualified technical expertise. Apple said the exclusion created an “evidentiary imbalance,” while Masimo countered that Apple has qualified engineering experts and is “rehashing arguments it already made and lost.”

Another unusual wrinkle: jurors may hear references to the ITC and CBP proceedings—evidence courts often keep out to avoid giving agency findings undue influence, said Bert C. Reiser, a partner at Cleary Gottlieb Steen & Hamilton LLP.

The evidentiary sparring underscores how credibility will matter at trial.

“The better story is often the more compelling one,” said Jeff Saltman, an intellectual-property trial lawyer at Cole Schotz PC. “It’s often the stronger fact witnesses that tell the story that will best connect with the jury.”

The trial is just one front in a broader legal campaign where each ruling shifts leverage but doesn’t settle the fight.

The verdict “seems unlikely to end the war,” said Nathan Mammen, a partner at Snell & Wilmer LLP. “Apple is already teeing up arguments for challenging any damages award,” he said, making another appeal “inevitable.”

Sullivan & Cromwell and Knobbe Martens represent Masimo and Cercacor. Wilmer Cutler Pickering Hale & Dorr LLP, Lewis and Llewellyn LLP, Pillsbury Winthrop Shaw Pittman LLP, Haynes & Boone LLP, and Gibson Dunn & Crutcher LLP represent Apple.

The case is Masimo Corp. v. Apple Inc., C.D. Cal., No. 8:20-cv-48.