Intellectual Property in the United States: The Apple Case

From December 26, Some Apple Smartwatches May Be Withdrawn from the Market for Violating Masimo's Intellectual Property

What Happened Between Masimo and Apple?

Masimo Corporation, based in California, establishes itself as a leader in technological innovation in the medical field. Founded with the mission of improving healthcare quality, the company has carved out a significant market share for developing, producing, and marketing vital parameters monitoring technologies, hospital automation solutions, and other consumer products.

The feud between Masimo and Apple began in 2020, when the medical company sued Apple, accusing it of recruiting more than 20 of its employees to steal trade secrets related to blood oxygen level measurement technology, which appeared in one of its smartwatch models. In 2021, the same technology became the subject of a new lawsuit when Masimo accused Apple of patent infringement. In 2022, the situation reversed, with Apple filing a lawsuit against Masimo, alleging that the latter had copied their technology.

In October of this year, the International Trade Commission confirmed Apple's violation, granting Masimo an unprecedented victory. The verdict resulted in a block on the imports of many of the latest models of Apple Watches in the United States, valued between 14 and 18 billion dollars, seriously jeopardizing the financial stability of the Big Tech.

Intellectual property disputes are commonplace, but rarely do they involve companies of this caliber and produce such startling results.

How Do Patents Work in the USA?

The World Intellectual Property Organization defines a patent as a property right that grants the inventor or holder the exclusive right to exploit, use, and market an invention for a certain period of time. A patent can be for a product, process, or improvement of an existing product or process, and must meet minimum requirements of novelty, concreteness, and industrial application.

In the United States, three types of patents can be registered:

• Utility Patent: directed at inventors of processes, machinery, and objects, covering inventions classified as new, helpful, and original.
• Design Patent: aimed at designers and anyone creating an innovative design for an object. This patent protects the appearance of the object but not its function or technical characteristics.
• Plant Patent: intended for those who develop or discover new plant varieties, living organisms, or seeds. The defense of intellectual property in the USA plays a crucial role in innovation and economic development.

Patents, trademarks, and copyright are the tools through which innovations in technology, art, medicine, and culture are defended, all crucial aspects to ensure the global competitiveness of the United States. According to a report published by the United States Patent and Trademark Office (USPTO), industries that register more trademarks and patents correspond to the companies crucial for the American economy, and are responsible for:

• 38% of the country's GDP;
• 52% of goods exports;
• 27.9 million jobs.

Since 1790, more than 12 million patents have been issued. A substantial increase occurred from 1968, the date of the first software registration, followed by millions of new issuances related to Big Tech. Consider that Samsung owns over 350,000, Google over 100,000, and Apple over 90,000.

Understanding Market Dynamics is Essential for Success in the United States

Even More Important is Protecting Intellectual Property, Lest You Lose Competitiveness in the US Market