In upholding a federal agency’s ruling in a dispute between Apple and medical device company AliveCor, President Biden has also boosted the patent case of one of his 2020 campaign’s largest donors and fundraisers.
The megadonor is Joe Kiani, founder and CEO of medical technology company Masimo, which like AliveCor is battling Apple over patents underlying sensor features of the Apple Watch. Kiani and his company have donated millions of dollars to pro-Biden super PACs and the Biden Inaugural Committee, as well as hosting in-person and online fundraisers for Biden as a presidential candidate.
This week, Silicon Valley startup AliveCor announced that the Biden administration informed it that it had decided not to veto a U.S. International Trade Commission (ITC) ruling from December that Apple Watch devices’ electrocardiogram (ECG) function infringes on its patents. The ITC ruling concluded that imports of Apple Watches with the ECG feature should be banned, among other remediation, but it also stated that enforcement of an import ban import should be held off while AliveCor’s patents were being reviewed by a separate agency, the U.S. Patent and Trademark Office (USPTO).
Presidential vetoes of ITC rulings are a rare occurrence, although President Obama did step in in 2013 to veto a ban on iPhones and other Apple products after an ITC decision in a patent battle with Samsung. Apple says it plans to appeal the ITC ruling.
In siding with AliveCor, President Biden is keeping alive the possibility of an Apple Watch import ban, which is precisely what Kiani’s company is seeking in a separate suit.
Masimo has launched similar patent challenges against versions of Apple Watches, seeking to have their importation to the U.S. banned. Masimo first sued Apple in 2020, and filed an ITC complaint in 2021, over what it argued was infringement of five pulse oximeter patents used for sensing blood oxygen levels.
Last month, an ITC judge ruled that one of Masimo’s patents had been infringed by Apple in the devices, setting up the case for a full commission review. Masimo hailed the ruling as a win for intellectual property rights, and Kiani made a CNBC appearance to tout his company’s case against the tech giant. A decision in that case on whether to ban certain Apple Watch imports is expected from the ITC in May. Masimo has requested that an import ban on infringing Apple Watches go into effect, which was supported by the initial ruling from ITC administrative law Judge Monica Bhattacharyya.
The appeals process in the two cases is expected to take more than a year, and the AliveCor dispute will also wend its way through the Patent Office’s Trial and Appeal Board. Tech industry observers at The Verge suggested that the case could result in hefty licensing fees from Apple for AliveCor and Masimo over the technologies. Bloomberg Law estimated that annual royalties of up to $300 million a year could be on the table for Masimo.
Biden Fundraiser Host
At a crucial point in the 2020 presidential nomination contest, Joe Kiani and his wife Sarah Kiani stepped up as major fundraisers supporting Biden’s campaign.
The businessman Kiani already had a relationship with the former vice president: in 2017, the Masimo Foundation was listed as a $1 million donor to the Biden Foundation. The following year, Biden recognized Kiani as “one of his closest friends” in remarks given at a health care conference on the search for a cure for cancer. The foundation, which supported programs in areas like gay rights and college affordability, and in so doing provided salaries to some in Biden’s orbit of political staffers, was shuttered as Biden readied to enter the presidential race.
