Apple Inc. will stop selling the latest versions of its smartwatch in the US due to a patent dispute, taking the devices off the market in the middle of the busy holiday season.
Sales of the Apple Watch Series 9 and Ultra 2 will be halted on the company’s online store on December 21 and at its physical retail stores beginning on Christmas Eve, it said in a statement.
The move comes ahead of the anticipated import ban of Apple Watch models with a blood oxygen sensor “- a feature in the latest lineup “- stemming from a legal battle with US-based medical technology company Masimo Corp.
“A Presidential Review Period is in progress regarding an order from the US International Trade Commission on a technical intellectual property dispute pertaining to Apple Watch devices containing the Blood Oxygen feature,” Apple said. “While the review period will not end until December 25, Apple is preemptively taking steps to comply should the ruling stand.”
Violation of Masimo patents
In October, the International Trade Commission ruled that Apple violates Masimo patents and would need to halt sales of infringing devices. The patents relate to an Apple Watch app that allows the device to calculate a person’s blood oxygen saturation.
The Apple Watch Series 9 and Ultra 2 generate the vast majority of the company’s watch sales. Apple doesn’t say how much revenue the device brings in, but it’s a core part of its Wearables, Home and Accessories business, which generates more than $40 billion a year.
The news sent the shares down 1.3 per cent in New York on Monday. They had reached a record high last week.
The devices will removed from Apple’s online store at 3 pm New York time on Thursday. Apple said there will be no impact to watches already sold to customers. The SE model, which lacks the blood oxygen feature, also remains on sale. The company said it would provide more information on December 25 as the review period concludes.
The need for Apple to stop selling a core product in the US is unprecedented, especially during the company’s most important quarter. An Apple spokesperson said that the decision from the ITC is erroneous and should be reversed.