Masimo v. Apple - Patents work, but people and routines are just as important
Masimo v. Apple
In January 2024, Apple had to stop all sales Apple Watch models in the USA that measure blood oxygen levels. The ban includes all models from Series 6, launched in 2020, and more importantly the newest models. The reason is an alleged infringement on the patents of the health-tech company Masimo.
This news punctures many myths about patents and digital technology. Aided by the “All our patents are belong to you”- statements from Elon Musk, many believe that patents are not relevant for digital technology in rapid development. At the same time, this case shows that securing one's own technology is about much more than patenting.
Granted, Masimo's patents are good. They were applied back in 2009, but hit well on the needs Apple has now in 2024. It is further not a matter of throwing expensive patents at the wall until they stick, but rather two honed patents that hit their target. But the patents are only part of the story.
The People
Early in 2013, Apple contacted Masimo to discuss a possible collaboration. The plan fell through, and July the same year Apple hires several people from Masimo, including their Chief Medical Officer. Independently of Masimo, Apple develops its version of the blood oxygen sensor, and launches it in its Apple Watch 6 in 2020.
This is a well-known tactic for draining others of knowledge. The potential in a collaboration is too great for Masimo to decline a meeting with Apple. At the same time, this gives Apple valuable insight into how the solution works and whom to hire to do it themselves.
Most will understand that such conversations about collaborating about a technology will require bulletproof confidentiality agreements, but the routines you have established before this are just as important, as these largely control what a competitor can achieve by snapping up your employees. A line is drawn between the employee's free know-how, and the company's protected trade secrets. This line is not static. Secrecy is a prerequisite, but in practice, protection will also require routines that let the employees know what is secret and belongs to the company.
Opposing internal interrests
This also illustrates crossing incentives in the protecting knowledge and technology. The company and employees have a shared interest in keeping competitors at bay, but employees may also have their own interest in being able to take as much as possible with them if they leave. In addition, there is the work and drudgery that protection requires, which for most is less fun than actually creating the solutions. Whether consciously or not, this affects how well secrecy, patents, trademarks, etc., are secured.
When the dust settles, Apple and Masimo will probably find a solution, and as it stands, Masimos hadn is strong. At the same time, there probably exists an even better alternative timeline, where Masimo and employees stood united, and Apple rather paid for the technology without a fight.
IP - a C-level concern
There isn't one single solution here, but many different approaches: co-ownership for key personnel, good routines, clear guidelines for when and how something is protected.
The most important thing is that the board and C-level sees the need, and takes it seriously.
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