Masimo Challenges CBP’s Ex Parte Order Allowing Apple to Restore Infringing Pulse Oximetry Function

On Wednesday, Irvine, CA-based health technology company Masimo Corporation filed a complaint for declaratory and injunctive relief against U.S. Customs and Border Protection (CBP) and several U.S. government officials, challenging ex parte rulings that allow consumer tech giant Apple to restore pulse oximetry functionality to several smartwatch models. This functionality had previously been found to infringe Masimo’s patents by the U.S. International Trade Commission (USITC), leading Masimo to question why the CBP utilized proceedings normally reserved for exceptional circumstances after Apple committed hundreds of billions to expand advanced manufacturing and supply chain capacity in the United States.

LEO Prohibiting Pulse Oximetry Function Circumvented by CBP Administrative Ruling

In October 2023, the USITC determined that Masimo established a Section 337 violation through Apple’s importation for sale of light-based physiological measurement devices infringing upon claims of two Masimo patents: U.S. Patent No. 10912502 and U.S. Patent No. 10945648, both titled User-Worn Device for Noninvasively Measuring a Physiological Parameter of a User. The ‘502 and ‘648 patents claim methods and devices for measuring blood analytes, including oxygen levels, using photodiodes receiving light from light-emitting diodes (LEDs) passing through a measurement site and processors identifying light wavelengths absorbed by analytes. Following the Section 337 determination, the USITC issued a limited exclusion order (LEO) prohibiting Apple from importing wearable electronic devices with the LED pulse oximetry functionality.

The day after the USITC issued its LEO, Apple requested an administrative ruling from CBP pursuant to 19 CFR § 177 regarding alleged redesigns to several Apple Watch models targeted by the LEO, including Series 8, Series 9, Ultra and Ultra 2 smartwatches. Following an inter partes proceeding, the CBP ruled that these smartwatches could not be excluded under the LEO because Apple had disabled their pulse oximetry functionality. Apple requested a second Section 177 ruling based on similar redesigns, and although details of this second request were largely redacted from Masimo’s complaint, the CBP denied Apple’s second request.

Despite CBP’s recognition that Apple’s pulse oximetry functionality must remain disabled, Apple announced on August 14 that “a recent U.S. Customs ruling” enabled it to immediately restore this functionality through a software update. Masimo’s complaint notes that it did not receive notice of any new CBP proceedings, nor was it provided an opportunity to participate in the process leading to this new ruling. Masimo contacted the Chief of the CBP’s Exclusion Order Enforcement Branch, who noted that the agency was authorized to conduct ex parte proceedings under exceptional circumstances but did not explain how such circumstances existed in this case.

Masimo Questions Timing of CBP Order, Significant Apple Investment Announcements

The day after Apple’s announcement, it provided Masimo with a redacted version of the CBP’s ex parte ruling. According to Masimo, the CBP “inexplicably reversed course” from its prior rulings in finding that Apple could overcome the LEO by shipping its smartwatches separately from iPhones, which would measure and calculate data captured by pulse oximetry sensors on the smartwatches under the new software update.

Masimo’s complaint calls out this conclusion as improperly supported by a 2009 USITC ruling finding that accused ink cartridges and printer adapters fell within the scope of an LEO when contained in the same shipment, leading CBP to the “logical fallacy” that accused articles within separate shipments are not prohibited by an LEO. Masimo also pointed out the CBP’s sua sponte consideration of indirect infringement issues underscored the agency’s belief that “adjudicating the watch-plus-iPhone combination had somehow traveled beyond its jurisdiction.”

The timing of the CBP’s ex parte ruling is questionable given its close proximity to a series of major U.S. investment announcements by Apple, Masimo’s complaint alleges. After Apple revealed its intentions this February to spend $500 billion in capital projects to improve manufacturing capacity across nine states, the consumer tech giant increased that commitment by $100 billion on August 6, days after the CBP’s ex parte ruling enabled Apple to restore pulse oximetry functionality on its devices.

Masimo’s complaint includes counts for arbitrary and capricious agency action and ultra vires action exceeding statutory authority in violation of the Administrative Procedures Act (APA), as well as violation of the Fifth Amendment’s Due Process Clause. Masimo seeks injunctive relief permanently enjoining the CBP and its agents from giving effect to the ex parte order and declaring that their actions are unlawful.

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Author: Kesu01