Apple to Pause Selling New Versions of Its Watch After Losing Patent Dispute

Apple said on Monday that it would pause sales of its flagship smartwatches online starting Thursday and at retail locations on Christmas Eve.

Two months ago, Apple lost a patent case over the technology its smartwatches use to detect people’s pulse rate. The company was ordered to stop selling the Apple Watch Series 9 and Watch Ultra 2 after Christmas, which could set off a run on sales of the watches in the final week of holiday shopping.

The move by Apple follows a ruling by the International Trade Commission in October that found several Apple Watches infringe on patents held by Masimo, a medical technology company in Irvine, Calif.

In court, Masimo detailed how Apple poached its top executives and more than a dozen other employees before later releasing a watch with pulse oximeter capabilities — which measures the percentage of oxygen that red blood cells carry from the lungs to the body — that were patented by Masimo.

To avoid a complete ban on sales, Apple had two months to cut a deal with Masimo to license its technology, or it could appeal to the Biden administration to reverse the ruling.

But Joe Kiani, the chief executive of Masimo, said in an interview that Apple had not engaged in licensing negotiations. Instead, he said that Apple had appealed to President Biden to veto the I.T.C. ruling, which Mr. Kiani knows because the administration contacted Masimo about Apple’s request.

“They’re trying to make the agency look like it’s helping patent trolls,” Mr. Kiani said of the I.T.C.

Apple didn’t respond to requests for comment on Mr. Kiani’s remarks. In a statement, the company said, “Apple strongly disagrees with the order and is pursuing a range of legal and technical options to ensure that Apple Watch is available to customers.”

The Biden administration didn’t immediately respond to request for comment.

Mr. Kiani said that he was willing to sell Apple a chip that Masimo had designed to provide pulse oximeter readings on the Apple Watch. The chip is currently in a Masimo medical watch, called the W1, that is approved by the Food and Drug Administration. The device uses algorithms to process red and near-infrared light to determine how oxygen-rich is the blood in arteries.

“If they don’t want to use our chip, I’ll work with them to make their product good,” Mr. Kiani said. “Once it’s good enough, I’m happy to give them a license.”

Apple introduced its first watch with pulse oximetry in 2020. It has included the technology, which it calls “blood oxygen,” in subsequent models. But unlike Masimo’s W1 device, Apple hasn’t had its watches cleared by the F.D.A. for use as a medical device for pulse oximetry.

The Apple Watch accounts for nearly $20 billion of the company’s $383.29 billion in annual sales, according to Bernstein Research, a financial research firm. Apple is the largest smartwatch seller in the world and accounts for about a third of all smartwatch sales, according to Counterpoint Research, a tech research firm.

Apple has had success persuading presidents in the past to veto I.T.C. rulings. In 2013, the Obama administration overturned a ban on the sale of some iPhones and iPads, after the court determined that Apple had violated a patent that Samsung owned.