US Court of Appeals sides with Apple in Masimo dispute

Court upholds USPTO and the PTAB decisions over blood-oxygen sensor in smartwatches | Ruling finds Masimo patents to be unpatentable and obvious | Only one claim relating to inconsistency to be reversed.

The US Court of Appeals for the Federal Circuit has sided with Apple in its legal dispute with Masimo over a blood-oxygen sensor in smartwatches.

The case saw Masimo filing multiple appeals arising from decisions made by the US Patent and Trademark Office (USPTO) Patent Trial and Appeal Board (PTAB) in various inter partes review proceedings. The PTAB issued final written decisions declaring nearly all claims of several Masimo-owned patents as unpatentable and obvious.

The US Court of Appeals reviewed the PTAB's decisions and reversed some aspects while affirming others.

The disputed patents concerned US numbers 10,258,265, 10,292,628, 10,577,553, 10,588,554, and 10,631,765.

These patents relate to an optical sensor designed for noninvasive blood constituent measurements, and describe a sensor equipped with multiple emitters, detectors, a housing, and a light-permeable cover featuring a convex surface.

Apple challenged the validity of Masimo's patents in a petition to the PTAB, suggesting they were unpatentable because they were obvious over prior art.

Masimo contested Apple's challenge at the appeals court, describing it as flawed and contradictory.

It also claimed that the "greatest curvature theory" proposed by Apple was introduced too late in the proceedings.

This theory suggests that light concentration increases where the curvature of a lens’s surface is the greatest.

Ultimately, the PTAB found that most of the challenged claims would have been obvious over the combination of references, except for independent claim 13 of the '554 patent.

Masimo's appeal arguments

In the appeal, Masimo presented five arguments challenging the PTAB's decision.

Firstly, Masimo argued that the PTAB erred by relying on theories that neither party had initially raised during the proceedings.

It highlighted cases where the PTAB's reliance on these theories allegedly deprived them of the opportunity to respond effectively.

Additionally, Masimo contended that the PTAB failed to consider contrary evidence and admissions made by Apple and its expert witness, which contradicted the PTAB's findings.

It cited legal precedents that underscored the PTAB's obligation to take such evidence into account.

Masimo also claimed that the PTAB erred by considering Apple's “greatest curvature theory”, which was allegedly introduced too late in the proceedings.

It argued that all arguments should have been presented in the initial petition, and that the PTAB should not have considered the new theories.

The medical device company asserted that the factual findings made by the PTAB, forming the basis of its determination of obviousness, lacked substantial evidence.

It specifically challenged the PTAB's findings related to motivation to combine references.

Finally, Masimo pointed out that the PTAB found claims 14–18 of the '554 patent obvious, while it found claim 13 non-obvious and argued that this inconsistency should lead to a reversal of the PTAB's decision.

The court's decision

The court emphasised the importance of the PTAB basing its decisions on arguments presented by the parties and noted that the allegedly new theories introduced by the PTAB were not essential to its determinations, as other motivations to combine references were considered.

Additionally, the court found that the PTAB did consider the evidence and arguments presented by Masimo but simply arrived at different conclusions, ultimately rejecting Masimo's contentions.

It also concluded that the PTAB did not err in considering Apple's “greatest curvature theory" in its decision, as it was presented in the reply to Masimo's arguments.

The court found that this did not violate the rules and that the theory had evidentiary support.

Finally, the court agreed with Masimo and Apple that the PTAB erred in finding claims 14–18 of the '554 patent obvious when it had found claim 13 non-obvious.

Therefore, it reversed the PTAB's finding regarding claims 14–18.

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