The White House has been paying close attention to a potential ban on Apple Inc.’s AAPL Watch sales, triggered by a patent infringement dispute with Masimo Corp MASI.
What Happened: A possible ban on the majority of Apple Watch sales in the U.S. has the Joe Biden administration on high alert, reported Bloomberg. The White House has been “tracking” the case actively.
While the Apple Watch Ultra 2 and Apple Watch Series 9 have been fairly popular among consumers, these smartwatches risk being banned from import into the U.S. or sold by Cupertino.
The International Trade Commission found that these watches broke patents owned by Masimo related to blood oxygen sensing.
The power to lift this ban is vested in the U.S. Trade representative Katherine Tai, who has been “carefully considering all of the factors in this case,” as per White House press secretary Karine Jean-Pierre’s statement on Tuesday.
Changes to the import ban must be finalized by the Dec. 25 deadline. However, Jean-Pierre added that the White House doesn’t intend to “get ahead of any decisions that may come” from the trade agency.
Although the U.S. President can intervene in import bans, such instances are rare. The last intervention was in 2013 when then-President Barack Obama stopped a ban on certain iPhone and iPad models due to Apple’s trade dispute with Samsung Electronics Co.
Why It Matters: Previously, it was reported that Apple has been strategizing to safeguard its $17 billion smartwatch business as the import ban deadline looms. The company has also reportedly been modifying algorithms that measure users’ blood oxygen levels — a feature Masimo Corp. alleged was a patent infringement.
However, despite the threat of this ban, industry experts suggest that the financial implications for Apple may not be as substantial as initially anticipated. According to leading equity analysts Samik Chatterjee and Joseph Cardoso of JPMorgan, the pause in sales of two Apple Watch models in the U.S. may not significantly dent Apple’s revenue.
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This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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