Customs Ruling HQ H335304 - Ruling Request; U.S. International Trade Commission; Limited Exclusion Order; Investigation No. 337-TA-1276; Certain Light-Based Physiological Measurement Devices and Components Thereof

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HQ H335304
Jan 12, 2024

Type : 19 U.S.C. § 1337; Unfair Competition • HTSUS :

OT:RR:BSTC:EOE H335304 WMW / ACC

Mark D. Selwyn
WilmerHale
2600 El Camino Real
Suite 400
Palo Alto, California 94306

VIA EMAIL: [email protected]

RE: Ruling Request; U.S. International Trade Commission; Limited Exclusion Order; Investigation No. 337-TA-1276; Certain Light-Based Physiological Measurement Devices and Components Thereof

Dear Mr. Selwyn:

Pursuant to 19 C.F.R. Part 177, the Exclusion Order Enforcement Branch, Regulations and Rulings, U.S. Customs and Border Protection ("CBP") issues this ruling letter holding that Apple Inc.'s ("Apple") redesigned versions of the Apple Watch models 8, 9, Ultra, and Ultra 2, ("Redesigned Watches" or "articles at issue") are not subject to the limited exclusion order ("LEO") that the U.S. International Trade Commission ("ITC" or "Commission") issued as a result of Investigation No. 337-TA-1276 ("the '1276 investigation") under Section 337 of the Tariff of 1930, as amended, 19 U.S.C. 1337.

We further note that determinations of the Commission resulting from the underlying investigation or a related proceeding under 19 C.F.R. Part 210 are binding authority on CBP and, in the case of conflict, will by operation of law modify or revoke any contrary CBP ruling or decision pertaining to section 337 exclusion orders.

This ruling letter is the result of a request for an administrative ruling under 19 C.F.R. Part 177, which was conducted on an inter partes basis. The proceeding involved the two parties with a direct and demonstrable interest in the question presented by the ruling request: (1) your client, Apple, the ruling requester and respondent in the 1276 investigation; and (2) Masimo Corporation and Cercacor Laboratories, Inc. ("Masimo"), the patent owner and complainant in the 1276 investigation. See, e.g., 19 C.F.R. 177.1(c).

The parties were asked to clearly identify confidential information, including information subject to the administrative protective order in the underlying investigation, with [[red brackets]] in their submissions. See 19 C.F.R. 177.2, 177.8. If there is additional information in this ruling letter not currently bracketed in red [[ ]] that either party believes constitutes confidential information, and should be redacted from the published ruling, the parties are asked to contact the EOE Branch within ten (10) working days of the date of this ruling letter. See, e.g., 19 C.F.R. 177.8(a)(3).

Please note that disclosure of information related to administrative rulings under 19 C.F.R. Part 177 is governed by, for example, 6 C.F.R. Part 5, 31 C.F.R. Part 1, 19 C.F.R. Part 103, and 19 C.F.R. 177.8(a)(3). See, e.g., 19 C.F.R. 177.10(a). In addition, CBP is guided by the laws relating to confidentiality and disclosure, such as the Freedom of Information Act ("FOIA"), as amended (5 U.S.C. 552), the Trade Secrets Act (18 U.S.C. 1905), and the Privacy Act of 1974, as amended (5 U.S.C. 552a). A request for confidential treatment of information submitted in connection with a ruling requested under 19 C.F.R. Part 177 faces a strong presumption in favor of disclosure. See, e.g., 19 C.F.R. 177.8(a)(3). The person seeking this treatment must overcome that presumption with a request that is appropriately tailored and supported by evidence establishing that: the information in question is customarily kept private or closely-held and either that the government provided an express or implied assurance of confidentiality when the information was shared with the government or there were no express or implied indications at the time the information was submitted that the government would publicly disclose the information. See Food Marketing Institute v. Argus Leader Media, 139 S. Ct. 2356, 2366 (2019) (concluding that "[a]t least where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is 'confidential' within the meaning of exemption 4."); see also U.S. Department of Justice, Office of Information Policy (OIP): Step-by-Step Guide for Determining if Commercial or Financial Information Obtained from a Person is Confidential Under Exemption 4 of the FOIA (updated 10/7/2019); and OIP Guidance: Exemption 4 after the Supreme Court's Ruling in Food Marketing Institute v. Argus Leader Media (updated 10/4/2019).

I. BACKGROUND

A. ITC Investigation No. 337-TA-1276

1. Procedural History at the ITC

The Commission instituted Investigation No. 337-TA-1276 on August 21, 2021, based on a complaint filed by Masimo Corporation of Irvine, California and Cercacor Laboratories, Inc. of Irvine, California. Certain Light-Based Physiological Measurement Devices and Components Thereof, Inv. No. 337-TA-1276, EDIS Doc. ID 808521, Public Commission Opinion (Nov. 14, 2023) ("Comm'n Op.") at 2 (citing 86 Fed. Reg. 46275-76 (Aug. 18, 2021)). The complaint, as supplemented, alleged a violation of section 337 by reason of infringement of certain claims of U.S. Patent Nos. 10,945,648 ("the '648 patent"), 10,912,502 ("the '502 patent"), 10,912,501 ("the '501 patent"), 10,687,745 ("the '745 patent"), and 7,761,127 ("the '127 patent"). Comm'n Op. at 3. The notice of investigation named Apple, as the sole respondent. Id. at 3. The Commission's Office of Unfair Import Investigations ("OUII") was not named as a party in the investigation. Id.

On January 10, 2023, the presiding Administrative Law Judge ("ALJ") issued her final initial determination, Certain Light-Based Physiological Measurement Devices and Components Thereof, Inv. No. 337-TA-1276, EDIS Doc. ID 1950712, Public Final Initial Determination (January 10, 2023) ("FID") finding a violation of section 337. Id. at 4. Specifically, the ALJ determined that a violation of section 337 occurred in the importation into the United States, the sale for importation, or the sale within the United States after importation, of the accused products due to infringement of certain claims of the '648 patent. Id.

On May 15, 2023, the Commission issued a notice in which it determined to review in part the FID and requested submissions responding to the Commission's questions on review and remedy, the public interest, and bonding. Id. at 6 (citing 88 Fed. Reg. 32243-46 (May 15, 2023). The Commission, in its review of the FID, found a violation of section 337 as to the '502, and '648 patents and determined that the appropriate remedy was a limited exclusion order directed to Apple. Id. at 54.

In the limited exclusion order, the Commission ordered that "light-based physiological measurement devices and components thereof . . . that infringe one or more of claims 22 and 28 of the '502 patent and claims 12, 24 and 30 of the '648 patent are excluded from entry for consumption into the United States, entry for consumption from a foreign-trade zone, or withdrawal from a warehouse for consumption, for the remaining terms of the Asserted Patents, except under license from, or with the permission of, the patent owner or as provided by law." Certain Light-Based Physiological Measurement Devices and Components Thereof, Inv. No. 337-TA-1276, EDIS Doc. ID 2011470, Limited Exclusion Order (Oct. 26, 2023) at 2, 1 ("1276 LEO"). The Commission further defined the articles covered by the limited exclusion order as "wearable electronic devices with light-based pulse oximetry functionality and components thereof." Id. at 2, 2.

2. The Patents and Claims in the 1276 LEO

The 1276 LEO prohibits the unlicensed entry for consumption of light-based physiological devices and components thereof that infringe one or more of claims 22 and 28 of the '502 patent and claims 12, 24 and 30 of the '648 patent. 1276 LEO at 2, 1. The discussion below of the patents at issue initially emphasizes the independent claims, and then any asserted claims that depend therefrom, as the burden of establishing noninfringement requires that a limitation in an asserted claim is not satisfied. See, e.g., Laitram Corp. v. Rexnord, Inc., 939 F.2d 1533, 1535 (Fed. Cir. 1991) ("[T]he failure to meet a single limitation is sufficient to negate infringement of the claim[.]"); Wahpeton Canvas Co. v. Frontier, Inc., 870 F.2d 1546, 1552, n.9 (Fed. Cir. 1989) ("One who does not infringe an independent claim cannot infringe a claim dependent on (and thus containing all the limitations of) that claim.").

a. Claims 22 and 28 of the '502 Patent

The '502 patent is titled "'User-Worn Device for Noninvasively Measuring a Physiological Parameter of a User' . . . [and] describes non-invasive physiological sensors for measuring blood constituents or analytes using multi-stream spectroscopy.'" FID at 25 (citing '502 patent at 7:18-26). Claim 22 depends from claims 19, 20, and 21. Id at 25. Claims 19-22 and independent claim 28 of the '502 patent are reproduced below:

19. A user-worn device configured to non-invasively measure an oxygen saturation of a user, the user-worn device comprising:

a plurality of emitters configured to emit light, each of the emitters comprising at least two light emitting diodes (LEDs);

four photodiodes arranged within the user-worn device and configured to receive light after at least a portion of the light has been attenuated by tissue of the user;

a protrusion comprising a convex surface including separate openings extending through the protrusion and lined with opaque material, each opening positioned over a different one associated with each of the four photodiodes, the opaque material configured to reduce an amount of light reaching the photodiodes without being attenuated by the tissue;

optically transparent material within each of the openings; and

one or more processors configured to receive one or more signals from at least one of the four photodiodes and output measurements responsive to the one or more signals, the measurements indicative of the oxygen saturation of the user.

20. The user-worn device of claim 19 further comprising a thermistor.

21. The user-worn device of claim 20, wherein the one or more processors are further configured to receive a temperature signal from the thermistor and adjust operation of the user-worn device responsive to the temperature signal.

22. The user-worn device of claim 21, wherein the plurality of emitters comprise at least four emitters, and wherein each of the plurality of emitters comprises a respective set of at least three LEDs.

28. A user-worn device configured to non-invasively measure an oxygen saturation of a user, the user-worn device comprising:

a first set of light emitting diodes (LEDs), the first set of LEDs comprising at least an LED configured to emit light at a first wavelength and an LED configured to emit light at a second wavelength;

a second set of LEDs spaced apart from the first set of LEDs, the second set of LEDs comprising at least an LED configured to emit light at the first wavelength and an LED configured to emit light at the second wavelength;

four photodiodes arranged in a quadrant configuration on an interior surface of the user-worn device and configured to receive light after at least a portion of the light as been attenuated by tissue of the user;

a thermistor configured to provide a temperature signal;

a protrusion arranged above the interior surface, the protrusion comprising:

a convex surface;

a plurality of openings in the convex surface, extending through the protrusion, and aligned with the four photodiodes, each opening defined by an opaque surface configured to reduce light piping; and

a plurality of transmissive windows, each of the transmissive windows extending across a different one of the openings;

at least one opaque wall extending between the interior surface and the protrusion, wherein at least the interior surface, the opaque wall and the protrusion form cavities, wherein the photodiodes are arranged on the interior surface within the cavities;

one or more processors configured to receive one or more signals from at least one of the photodiodes and calculate an oxygen saturation measurement of the user, the one or more processors further configured to receive the temperature signal;

a network interface configured to wirelessly communicate the oxygen saturation measurement to at least one of a mobile phone or an electronic network;

a user interface comprising a touch-screen display, wherein the user interface is configured to display indicia responsive to the oxygen saturation measurement of the user;

a storage device configured to at least temporarily store at least the measurement; and a strap configured to position the user-worn device on the user.

FID at 22-24; '502 patent at 46:22-54 and 47:13-23 (emphasis added).

b. Claims 12, 24, and 30 of the '648 Patent

The '648 patent is titled "'User-Worn Device for Noninvasively Measuring a Physiological Parameter of a User' . . . [and] describes non-invasive physiological sensors for measuring blood constituents or analytes using multi-stream spectroscopy.'" FID at 20 (citing '502 patent at 7:18-26). Claim 12 depends from claim 8 and claims 24 and 30 both depend from claim 20. Id. at 24. Claims 8, 12, 20, 24, and 30 of the '648 patent are reproduced below:

8. A user-worn device configured to non-invasively determine measurements of a physiological parameter of a user, the user-worn device comprising:

a first set of light emitting diodes (LEDs), the first set comprising at least an LED configured to emit light at a first wavelength and at least an LED configured to emit light at a second wavelength;

a second set of LEDs spaced apart from the first set of LEDs, the second set of LEDs comprising an LED configured to emit light at the first wavelength and an LED configured to emit light at the second wavelength;

four photodiodes;

a protrusion comprising a convex surface, at least a portion of the protrusion comprising an opaque material;

a plurality of openings provided through the protrusion and the convex surface, the openings aligned with the photodiodes;

a separate optically transparent window extending across each of the openings;

one or more processors configured to receive one or more signals from at least one of the photodiodes and output measurements of a physiological parameter of a user;

a housing; and

a strap configured to position the housing proximate tissue of the user when the device is worn.

FID at 24; '648 patent at 45:45-46:3 (emphasis added)

12. The user-worn device of claim 8, wherein the physiological parameter comprises oxygen or oxygen saturation.

Id. at 25; '648 patent at 46:15-16

20.The use-worn device configured to non-invasively determine measurements of a user's tissue, the user-worn device comprising:

a plurality of light emitting diodes (LEDs);

at least four photodiodes configured to receive light emitted by the LEDs, the four photodiodes being arranged to capture light at different quadrants of tissue of a user;

a protrusion comprising a convex surface and a plurality of through holes, each through hole including a window and arranged over a different one of the at least four photodiodes; and

one or more processors configured to receive one or more signals from at least one of the photodiodes and determine measurements of oxygen saturation of the user.

Id.; '648 patent at 46:34-49. (emphasis added)

24. The user-worn device of claim 20, wherein the protrusion comprises opaque material configured to substantially prevent light piping.

Id.; '648 patent at 46:59-61.

30. The user-worn device of claim 20, wherein the protrusion further comprises one or more chamfered edges.

Id.; '648 patent at 47:6-7.

3. The Products from the Underlying Investigation

The legacy articles in the underlying investigation consisted of two current generation Apple smartwatches, models 6 and 7, as well as those models still in development. Comm'n Op at 14-15. These articles were found to practice each limitation of claim 28 of the '502 patent. See FID at 49. These articles were also found to practice each of the limitations of both claims 8 and 12 of the '648 patent. Id. at 52. Additionally, these articles were found to practice each of the limitations of claims 20 and 24 of the '648 patent. Id. at 55.

In the underlying investigation, the parties did not dispute that the legacy articles practiced claim 22 of the '502 patent as construed during the underlying investigation. FID at 40-44. Instead, Apple disputed infringement of claim 22 of the '502 patent based on proposed constructions for the claim terms "over" and "openings." FID at 41. Specifically, Apple argued that the legacy articles did not practice limitation 19C from claim 22 of the '502 patent based on its proposed constructions. Id. Apple's proposed constructions for these claim terms "have been rejected" during the underlying investigation. Id.

In the underlying investigation, the parties did not dispute that the legacy articles practiced claim 12 of the '648 patent as construed during the underlying. FID at 49-52. Instead, Apple disputed infringement of claim 12 of the '648 patent based on proposed constructions of the term "openings." FID at 51. Specifically, Apple argued that the legacy articles do not practice limitation 8E from claim 12 of the '648 patent based on its proposed construction. FID at 51. Apple's proposed construction for the term "openings" "have been rejected" during the underlying investigation. Id.

In the underlying investigation, the parties did not dispute that the legacy articles practiced claim 24 of the '648 patent as construed during the underlying investigation. FID at 53-55. Instead, Apple disputed infringement of claim 24 of the '648 patent based on proposed constructions for the claim terms "over" and "through holes." FID at 54. Specifically, Apple argues that the legacy articles did not practice limitation 20D from claim 24 of the '648 patent based on its proposed constructions. Id. Apple's proposed constructions for the claim terms for the claim terms "over" and "through holes" "have been rejected" during the underlying investigation. Id. Claim 30 of the '648 patent is a dependent claim that depends from claim 20. Besides proposing constructions for the claim terms "over" and "through holes" which appear in limitation 20D from claim 24 of the '648 patent, Apple did not dispute that the legacy articles infringe claim 30 of the '648 patent as construed during the underlying investigation. FID at 55.

When discussing infringement of the '745 patent, the ALJ noted that there was "no dispute that Apple has provided instructions to its users for pairing the Accused Products with Apple iPhones to monitor blood oxygen through Apple's Health app." FID at 198. In its decision to review the Final ID in part, the Commission did not review whether the articles were found to practice the relevant claims of the '502 and '648 patents, but rather whether the patents themselves were obvious. See Comm'n Op. at 6. The "parties [did] not dispute that the currently-existing Apple Watch Series SE [did] not infringe the Asserted Patents because it is not equipped to measure to blood oxygen saturation of a user." Comm Op. at 14.

B. 19 C.F.R. Part 177 Ruling Request

1. Procedural History

On November 27, 2021, Apple submitted a letter to CBP requesting an administrative ruling pursuant to 19 C.F.R. Part 177, which included Attachments A-E (collectively, "Ruling Request"). Apple to EOE Branch, dated October 27, 2023. Apple requested an administrative ruling that the redesigned watch products presented in the ruling request have removed the light-based pulse oximetry functionality previously found to infringe the '502 and '648 patents at issue in the 1174 LEO issued by the ITC. Ruling Request at 1. On October 30, 2023, the EOE Branch confirmed receipt of the ruling request submitted by Apple along with the proposed procedural schedule submitted by Apple and additionally requested that Masimo submit a proposed procedural schedule. EOE email to parties, dated October 30. On October 30, 2023, Apple confirmed that an unredacted copy of the ruling request was sent to Masimo and that the parties had agreed to an NDA and provided a copy to the EOE Branch. Selwyn email to EOE Branch, dated October 30, 2023. On November 1, 2023, Masimo submitted a letter to the EOE Branch stating that it had not yet received a physical sample of the proposed redesign, source code to compare with the proposed redesigned source code, a live demonstration of the proposed redesign and information regarding testing of the proposed redesign, and would need this information before it could propose a procedural schedule. Swaroop email to EOE Branch, dated November 1, 2023. On November 2, 2023, Apple submitted a letter to the EOE Branch stating that Apple has provided Masimo with the source code needed to evaluate the proposed redesign and that it is available for inspection when requested. Frazier email to EOE Branch, dated November 11, 2023. Additionally, Apple stated that the request for a demonstration could be obliged, though it did not comment on whether a physical sample would be provided. Id.

On November 3, 2023, the EOE Branch had an initial conference call with Apple and Masimo, on which both parties agreed to conduct this proceeding on an inter partes basis as administered by the EOE Branch. During this initial call, the EOE Branch and the parties discussed scheduling for the inter partes ruling and requested that the parties submit a joint proposed schedule on November 7, 2023 and if the parties were unable to agree on such a schedule to submit a proposed schedule that same day. EOE Branch email to parties, dated November 3, 2023. On November 7, 2023, both parties submitted their respective proposed procedural schedules. Selwyn email to EOE Branch, dated November 7, 2023 and Swaroop email to EOE Branch dated November 7, 2023. On November 10, 2023, the EOE Branch sent out the procedural schedule and set the target date for the EOE Branch to issue the ruling on January 5, 2024. EOE Branch email to Parties, dated November 10, 2023.

On November 20, 2023, in accordance with the procedural schedule established by the EOE Branch, Masimo stated that it had not yet received all of the information needed in order to properly draft a response to the ruling request submitted by Apple, specifically that it had not had the opportunity to receive evidence, including samples, of the proposed redesign being applied to the series 9 and Ultra 2 model of smartwatches, as well as the opportunity to depose Apple personnel. Swaroop email to EOE Branch, dated November 20, 2023. On November 20, 2023, the EOE Branch proposed a conference call on November 21, 2023 to discuss the issues raised by this communication. EOE Branch email to Parties, dated November 20, 2023. During the call, Apple declined to provide a sample to Masimo, though stated that samples would be available for inspection. After the conference call on November 21, 2023, the EOE Branch sent out a revised procedural schedule and set the target date for the EOE Branch to issue the ruling on January 12, 2024. EOE Branch email to Parties, dated November 21, 2023.

On December 6, 2023, Masimo provided its response to the Ruling Request, which included attachments 1-50 (collectively, "Masimo Response"). On December 13, 2023, Apple provided its reply to the Masimo Response, which included Attachments F through I (collectively, "Apple Reply"). On December 20, 2023, Masimo provided its sur-reply ("Masimo Sur-Reply") to the Apple Reply. On December 28, 2023, the EOE Branch conducted an oral discussion with the parties, with each party providing a presentation ("Apple Oral Discussion Presentation" and "Masimo Oral Discussion Presentation accordingly). Lastly, on January 5, 2024, the parties submitted post oral discussion submissions ("Apple Post Oral Discussion Submission" and "Masimo Post Oral Discussion Submission" accordingly).

2. The Articles at Issue

The articles at issue in the Ruling Request consist of certain smartwatches accused at the underlying ITC proceeding and unaccused smartwatches that were developed and sold after the implementation of the Investigation at the ITC. Specifically, the products for which Apple requested a ruling are:

(a) Apple Watch Series 6-9; and (b) Apple Watch Ultra and Ultra 2

Ruling Request at 9. Of the articles at issue, the Apple Watch Series 6-8 were accused and found to infringe during the underlying investigation. Id. The Apple Watch Series 9, Ultra and Ultra 2 were not accused but became available in the United States after the filing of Masimo's complaint at the Commission. Id.

The articles at issue in the ruling request, as referenced above, are depicted below:

a. Apple Watch Series 6 and 7

As noted above, during the underlying investigation, The ITC found that the Apple Watch Series 6 and 7 were found to infringe that claims at issue in the '502 patent and '648 patent. See FID at 49, 52 and 55. In its Ruling Request, Apple argues that its proposed redesign of the Apple Watch Series 6 and 7 place it outside the category of products subject to the 1276 LEO. See Ruling Request at 1.

b. Apple Watch Series 8, 9, Ultra and Ultra 2

At the time of filing of the complaint at the ITC, Apple Watch Series 8,9, Ultra and Ultra 2 did not exist, but were released after the evidentiary hearing. See Ruling Request at 9. The Commission included the Apple Watch Series 8 in its determination of the accused products in its opinion. See Comm'n Op. at 13-14. In its Ruling Request, Apple argues that its proposed redesign of the Apple Watch Series 8,9, Ultra and Ultra 2 place it outside the category of products subject to the 1276 LEO. See Ruling Request at 1.

c. Redesign Under Consideration

The redesign at issue in this ruling request comprises of two steps. The first step is implemented on the articles at issue, in that every Apple Smart Watch with pulse oximetry capability destined to be sold in the United States and Puerto Rico is [[ ]] See Ruling Request at 11. See Also Ruling Request, Attachment C at 8. The second step involves modifying the [[ ]] the iPhone for use with the articles at issue to block pulse oximetry functionality during the pairing process. Id. Despite the changes above, the Redesigned Watches have the same pulse oximetry hardware as the legacy products found to infringe. See Masimo Sur-Reply at 7.

The Redesigned Watches "must be paired to an iPhone before becoming operable." Attachment F to Apple Reply ("Crowell Decl.") at 15; see also Apple Post-Oral Discussion Submission at 9. Prior to pairing with an iPhone, the Redesigned Watches "cannot perform the Blood Oxygen feature or [] any feature." Apple Post-Oral Discussion Submission at 9 (citing Cromwell Decl. at 15).

1. Apple's Pairing of Redesigned Watches

The Redesigned Watches have been designed by Apple to "only pair with iPhone XS or newer models" and "pair only with an iPhone running the '.0' version or higher of the latest operating system [(i.e., currently iOS 17).]" Cromwell Decl. at 16-18; see also Apple Post-Oral Discussion Submission at 9-10; see also Cromwell Decl., Ex. 6.

After the Redesigned Watches are activated via pairing with an iPhone of a compatible model and operating system version, the Redesigned Watches will [[ ]] Apple Post-Oral Discussion Submission at 10. Specifically, the Redesigned Watches [[

]] See Amended Attachment C to Ruling Request ("Thomas Decl.") at 34; see also Apple Post Oral Discussion Submission at 10. [[

]] Thomas Decl. at 34-35; see also Apple Post Oral Discussion Submission at 10. According to Apple, [[ ]] indicating that the Blood Oxygen feature is removed." Thomas Decl. at 34-35. see also Apple Post Oral Discussion Submission at 10. After the [[ ]] each time the user attempts to access the blood oxygen feature using a Redesigned Watch or an iPhone actively paired with a Redesigned Watch. Thomas Decl. at 35; see also Apple Reply at 5; see also Apple Post Oral Discussion Submission at 10. For example, [[

]] See Apple Post-Oral Discussion Submission at 11. The [[ ]] on the Redesigned Watch prevents a user from using the "[b]lood [o]xygen feature ... to take a measurement or to enable background blood measurements." Thomas Decl. at 91-92; see also Apple Post Oral Discussion Submission at 11. When "the [[ ]] indicate[s] that the [b]lood [o]xygen feature is removed, the [r]edesigned [Apple] [w]atch will (i) prevent the Watch from engaging in any pulse oximetry functionality or measurement, (ii) prevent the user from enabling any pulse oximetry functionality or measurement, including Blood Oxygen feature measurements or background measurements, and (iii) display a screen indicating that the Blood Oxygen feature is unavailable[.]" Thomas Decl. at 35, 41; see also Apple Post Oral Discussion Submission at 10; see also Masimo Post Oral Discussion Submission at 15.

For example, when a user attempts to open the Blood Oxygen Application on a Redesigned Watch using the pairing method discussed above, the Redesigned Watch will no longer initiate a blood oxygen measurement and the user will see a user interface explaining that "[t]he Blood Oxygen app is not available. Learn more in the Health app on your iPhone" as shown in the images below:

Ruling Request at 12; see also Thomas Decl., Ex. 1 at 11, 22.

Additionally, Apple has "indicated in all marketing and educational materials for the [Redesigned Watches] that the Blood Oxygen feature would no longer be available in the United States and Puerto Rico." Ruling Request at 13. Specifically, Apple has "remov[ed] references to the Blood Oxygen feature from marketing materials, including webpages, and by adding notations to educational materials indicating that the Blood Oxygen feature is no longer available for Redesigned Watch Products with part numbers ending in LW/A sold in the United States and Puerto Rico. Ruling Request at 13.

2. Masimo's Pairing of Redesigned Watch

Masimo notes that "Apple's [[ ]] from its "proper pairing" did not cause the [[ ]] because Masimo accessed the blood oxygen feature on the very same LW/A Watches after Apple had already paired them using the pairing methods discussed below. Masimo Post-Oral Discussion Submission at 15. To test the Redesigned Watches, Masimo paired the Redesigned Watches to iPhones using two different methods. Both methods involve paring the Redesigned Watches with a "jailbroken" iPhone. See Masimo Sur-Reply at 10. "Jailbreaking" refers to a modification of a device that "permits the circumvention of computer programs on mobile phones to enable interoperability of non-vendor-approved software applications[.]" Exemption to Prohibition on Circumvention of Copyright Protection Systems for Access Control Technologies, 77 Fed. Reg. 65260, 65263 (Oct. 26, 2012) (codified at 37 C.F.R. 201.40); see also Masimo Sur-Reply at 9.

For the first method, Masimo used an iPhone X (i.e., an outdated iPhone) running iOS 15 (i.e., an outdated version of the iOS operating system) and installed the Legizmo Lighthouse application onto the phone. Madisetti Decl. at 67-92; see also Masimo Slides at 24; see also Apple Post Oral Discussion Submission at 8-9 ("Apple blocks the current generation of Apple Watch models (Series 9 and Ultra 2) from pairing with iPhone X or older models" and "to ensure security, current versions of Apple Watches, including the Series 9 and Ultra 2, are configured by Apple to pair only with the most recent iOS release [i.e., iOS 17.0 or later].") (citing Crowell Decl. at 15-19). Legizmo Lighthouse is a publicly available "third-party application that cannot be installed on an iPhone unless ... the iphone is 'jailbroken.'" Apple Reply at 9; see also Crowell Decl. at 21-24, 30-32. The Legizmo Lighthouse application allows users "to pair an outdated iPhone and/or iOS to a 'normally' incompatible Apple Watch." Apple Reply at 11; see also Masimo Sur-Reply at 8. When employing this third-party application, Masimo was able to pair the modified iPhone with the redesigned LW/A Series 9 Apple Watch. Masimo Response at 7, 11; Madisetti Decl. at 75. After pairing, "the Health application and the Watch application on the iPhone identified the availability of the Blood Oxygen feature" and "Masimo [was able to use] the [redesigned] LW/A Series 9 to measure blood oxygen." Masimo Response at 7; see also Madisetti Decl. at 80-81, 84-90. As shown below, with the modifications noted above, the redesigned Apple "watch sen[t] the blood oxygen results to the paired iPhone where they were displayed in the Health application":

Masimo Response at 7; see also Madisetti Decl. at 90; see also Masimo Slides at 26.

For the second method, Masimo used an iPhone X (i.e., an outdated iPhone) running iOS 16 (i.e., an outdated version of the iOS operating system) installed with the same third-party Legizmo Lighthouse application discussed above. Madisetti Decl. at 67-92; see also Masimo Slides at 24. Additionally, Masimo found five files on the iPhone that use the term [[ ]] and Masimo modified the files to change all instances of [[ ]][.] Masimo Response at 7; see also Madisetti Decl. at 72; see also Apple Post Oral Discussion Submission at 12. Masimo was able to pair the modified iPhone with a redesigned LW/A Ultra 2 Apple watch. See Masimo Response at 7; see also Masimo Slides at 28. After pairing, Masimo was able to measure blood oxygen with the Redesigned Watch and the results of the blood oxygen measurements were sent to and displayed on the iPhone as shown in the images below:

Masimo Response at 7; see also Madisetti Decl. at 75-92; see also Masimo Slides at 28.

Apple notes that Masimo was only able to access the blood oxygen measurements using the method above in its view "by reconfiguring the Redesigned Watch Products-using hacked, jailbroken, out-of-date iPhones containing out-of-date iOS and third-party security 'exploits' to corrupt the pairing process". Apple Post Oral Discussion Submission at 2. Masimo does not dispute that it was only able to access the blood oxygen measurements through the steps and modifications described above. According to Apple, Masimo's pairing of the Redesigned Watches "corrupt[ed]" the pairing process because it "materially change[s] the configuration of the Redesigned Watch Products, [[

]] Apple Post Oral Discussion Submission at 3.

II. ISSUE

Whether Apple has met its burden to show that the articles at issue do not infringe the relevant claims of the asserted patents and, thus, are not subject to the limited exclusion order issued in the 1276 investigation. See Ruling Request at 1.

III. LEGAL FRAMEWORK

A. Section 337 Exclusion Order Administration

The Commission shall investigate any alleged violation of section 337 to determine, with respect to each investigation conducted by it under this section, whether there is a violation of this section. See 19 U.S.C. 1337(b)(1) and (c). If the Commission determines, as a result of an investigation under this section, that there is a violation of this section, it shall direct that the articles concerned, imported by any person violating the provision of this section, be excluded from entry into the United States unless the Commission finds based on consideration of the public interest that such articles should not be excluded from entry. See 19 U.S.C. 1337(d)(1).

When the Commission determines that there is a violation of section 337, it generally issues one of two types of exclusion orders: (1) a limited exclusion order or (2) a general exclusion order. See Fuji Photo Film Co., Ltd. v. ITC, 474 F.3d 1281, 1286 (Fed. Cir. 2007). Both types of orders direct CBP to bar infringing products from entering the country. See Yingbin-Nature (Guangdong) Wood Indus. Co. v. ITC, 535 F.3d 1322, 1330 (Fed Cir. 2008). "A limited exclusion order is 'limited' in that it only applies to the specific parties before the Commission in the investigation. In contrast, a general exclusion order bars the importation of infringing products by everyone, regardless of whether they were respondents in the Commission's investigation." Id. A general exclusion order is appropriate only if two exceptional circumstances apply. See Kyocera Wireless Corp. v. ITC, 545 F.3d 1340, 1356 (Fed. Cir. 2008). A general exclusion order may only be issued if (1) "necessary to prevent circumvention of a limited exclusion order," or (2) "there is a pattern of violation of this section and it is difficult to identify the source of infringing products." 19 U.S.C. 1337(d)(2); see Kyocera, 545 F.3d at 1356 ("If a complainant wishes to obtain an exclusion order operative against articles of non-respondents, it must seek a GEO [general exclusion order] by satisfying the heightened burdens of 1337(d)(2)(A) and (B).").

In addition to the action taken above, the Commission may issue an order under 19 U.S.C. 1337(i) directing CBP to seize and forfeit articles attempting entry in violation of an exclusion order if their owner, importer, or consignee previously had articles denied entry on the basis of that exclusion order and received notice that seizure and forfeiture would result from any future attempt to enter articles subject to the same. An exclusion order under 1337(d)-either limited or general-and a seizure and forfeiture order under 1337(i) apply at the border only and are operative against articles presented for customs examination or articles conditionally released from customs custody but still subject to a timely demand for redelivery. See 19 U.S.C. 1337(d)(1) ("The Commission shall notify the Secretary of the Treasury of its action under this subsection directing such exclusion from entry, and upon receipt of such notice, the Secretary shall, through the proper officers, refuse such entry."); id., at (i)(3) ("Upon the attempted entry of articles subject to an order issued under this subsection, the Secretary of the Treasury shall immediately notify all ports of entry of the attempted importation and shall identify the persons notified under paragraph (1)(C).") (emphasis added).

Significantly, unlike district court injunctions, the Commission can issue a general exclusion order that broadly prohibits entry of articles that violate section 337 of the Tariff Act of 1930 without regard to whether the persons importing such articles were parties to, or were related to parties to, the investigation that led to issuance of the general exclusion order. See Vastfame Camera, Ltd. v. ITC, 386 F.3d 1108, 1114 (Fed. Cir. 2004). The Commission also has recognized that even limited exclusion orders have broader applicability beyond just the parties found to infringe during an investigation. See Certain GPS Devices and Products Containing Same, Inv. No. 337-TA-602, Comm'n Op. at 17, n.6, Doc ID 317981 (Jan. 2009) ("We do not view the Court's opinion in Kyocera as affecting the issuance of LEOs [limited exclusion orders] that exclude infringing products made by respondents found to be violating Section 337, but imported by another entity. The exclusionary language in this regard that is traditionally included in LEOs is consistent with 19 U.S.C. 1337(a)(1)(B)-(D) and 19 U.S.C. 1337(d)(1).").

Moreover, "[t]he Commission has consistently issued exclusion orders coextensive with the violation of section 337 found to exist." See Certain Erasable Programmable Read Only Memories, Inv. No. 337-TA-276, Enforcement Proceeding, Comm'n Op. at 11, Doc ID 43536 (Aug. 1991) (emphasis added). "[W]hile individual models may be evaluated to determine importation and [violation], the Commission's jurisdiction extends to all models of [violative] products that are imported at the time of the Commission's determination and to all such products that will be imported during the life of the remedial orders." See Certain Optical Disk Controller Chips and Chipsets, Inv. No. 337-TA-506, Comm'n Op. at 56-57, USITC Pub. 3935, Doc ID 287263 (July 2007).

Lastly, despite the well-established principle that "the burden of proving infringement generally rests upon the patentee [or plaintiff]," Medtronic, Inc. v. Mirowski Family Ventures, LLC, 571 U.S. 191 (2014), the Commission has held that Medtronic is not controlling precedent and does not overturn its longstanding practice of placing the burden of proof on the party who, in light of the issued exclusion order, is seeking to have an article entered for consumption. See Certain Sleep-Disordered Breathing Treatment Systems and Components Thereof, Inv. No. 337-TA-879, Advisory Opinion at 6-11. In particular, the Commission has noted that "[t]he Federal Circuit has upheld a Commission remedy which effectively shifted the burden of proof on infringement issues to require a company seeking to import goods to prove that its product does not infringe, despite the fact that, in general, the burden of proof is on the patentee to prove, by a preponderance of the evidence, that a given article does infringe. . . ." Certain Integrated Circuit Telecommunication Chips, Inv. No. 337-TA-337, Comm'n Op. at 21, n.14, USITC Pub. 2670, Doc ID 217024 (Aug. 1993), (emphasis in original) (citing Sealed Air Corp. v. ITC, 645 F.2d 976, 988-89 (C.C.P.A. 1981)).

This approach is supported by Federal Circuit precedent. See Hyundai Elecs. Indus. Co. v. ITC, 899 F.2d 1204, 1210 (Fed. Cir. 1990) ("Indeed, we have recognized, and Hyundai does not dispute, that in an appropriate case the Commission can impose a general exclusion order that binds parties and non-parties alike and effectively shifts to would-be importers of potentially infringing articles, as a condition of entry, the burden of establishing noninfringement. The rationale underlying the issuance of general exclusion orders-placing the risk of unfairness associated with a prophylactic order upon potential importers rather than American manufacturers that, vis-a-vis at least some foreign manufacturers and importers, have demonstrated their entitlement to protection from unfair trade practices-applies here [in regard to a limited exclusion order] with increased force.") (emphasis added) (internal citation omitted).

B. Patent Infringement

Determining patent infringement requires two steps. Advanced Steel Recovery, LLC v. X-Body Equip., Inc., 808 F.3d 1313, 1316 (2015). The first is to construe the limitations of the asserted claims and the second is to compare the properly construed claims to the accused product. Id. To establish literal infringement, every limitation recited in a claim must be found in the accused product whereas, under the doctrine of equivalents, infringement occurs when there is equivalence between the elements of the accused product and the claimed elements of the patented invention. Microsoft Corp. v. GeoTag, Inc., 817 F.3d 1305, 1313 (Fed. Cir. 2016). One way to establish equivalence is by showing, on an element-by-element basis, that the accused product performs substantially the same function in substantially the same way with substantially the same result as each claim limitation of the patented invention, which is often referred to as the function-way-result test. See Intendis GmbH v. Glenmark Pharms., Inc., 822 F.3d 1355, 1361 (Fed. Cir. 2016).

As for the first step above, "claim construction is a matter of law." SIMO Holdings, Inc. v. H.K. uCloudlink Network Tech., Ltd., 983 F.3d 1367, 1374 (Fed. Cir. 2021). Moreover, the ultimate construction of a claim limitation is a legal conclusion, as are interpretations of the patent's intrinsic evidence (the patent claims, specifications, and prosecution history). UltimatePointer, L.L.C. v. Nintendo Co., 816 F.3d 816, 822 (Fed. Cir. 2016) (citing Teva Pharms. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841, 190 L. Ed. 2d 719 (2015).[1]

"Importantly, the person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification." Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005) (en banc). "In some cases, the ordinary meaning of claim language as understood by a person of skill in the art may be readily apparent even to lay judges." Id. at 1314. In others, courts look to public sources such as "the words of the claims themselves, the remainder of the specification, the prosecution history, and extrinsic evidence concerning relevant scientific principles, the meaning of technical terms, and the state of the art." Id.

"To begin with, the context in which a term is used in the asserted claim can be highly instructive." Phillips, 415 F.3d at 1314 ("To take a simple example, the claim in this case refers to 'steel baffles,' which strongly implies that the term 'baffles' does not inherently mean objects made of steel."). The context in which a claim term is used also includes the full chain of dependence as well as the remaining suite of claims and the written description. See Inline Plastics Corp. v. EasyPak, LLC, 799 F.3d 1364, 1371 (Fed. Cir. 2015) ("Since the specification explicitly mentions the 'alternative' . . . there can be no debate concerning the application of the doctrine of claim differentiation.").

The second step to establish infringement involves a comparison of the claims, as properly construed, to the accused product, which is a question of fact. Apple Inc. v. Samsung Elecs. Co., Ltd., 839 F.3d 1034, 1040 (Fed. Cir. 2016) (en banc).

In addition to direct infringement, a party can indirectly infringe a patent through active inducement, which occurs if the party knew of the patent and that the induced acts constitute patent infringement. See Commil USA, LLC v. Cisco Sys., Inc., 575 U.S. 632 (2015), cited in FID at 23; see also 35 U.S.C. 271(b) ("Whoever actively induces infringement of a patent shall be liable as an infringer."). For a finding of induced infringement, the infringer must possess a specific intent to encourage another's infringement. See i4i Ltd. Partnership v. Microsoft Corp., 598 F.3d 831, 851 (Fed. Cir. 2010), aff'd, 564 U.S. 91 (2011), cited in FID at 23. Furthermore, induced infringement requires a showing that the accused inducer took an affirmative act to encourage infringement. See Microsoft Crop. v. Datatern, Inc., 755 F.3d 899, 904 (Fed. Cir. 2013), cited in FID at 23.

C. Patent Infringement Based on Capability or Actual Operation

When applying the two-step inquiry for patent infringement noted above, certain cases at the U.S. Court of Appeals for the Federal Circuit ("Federal Circuit") have held that, to find infringement, a device only needs to be capable of operating according to the relevant claim limitations while others have found that a device does not infringe unless it actually operates as claimed. See INVT SPE LLC v. ITC, 46 F.4th 1361, 1371 (Fed. Cir. 2022) (citing Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1204 (Fed. Cir. 2010) for the former and ParkerVision, Inc. v. Qualcomm Inc., 903 F.3d 1354, 1361 (Fed. Cir. 2018) for the latter). "Whether infringement requires actual performance of the recited functions by the accused device depends on the claim language." INVT, 46 F.4th at 1371. "[T]he most straightforward example of this is the common distinction between method claims and apparatus claims" where "non-method claims describe capabilities without requiring that any software components be 'active' or 'enabled'" and method claims that "require[] actual performance of each claimed step." Id. (quoting and citing Finjan, 626 F.3d at 1204-05, 1206).

Nevertheless, "differences exist between apparatus claims as well, depending on the claim language. [The Federal Circuit has] construed some apparatus claims to require an infringing device to actually perform and operate according to the functional terms recited in the claim" but "construed other apparatus claims to require only capability[.]" INVT at 1371. For example, in Finjan, because the "defendants admitted [the] program code for the relevant function . . . was literally present on all accused devices, the claim was infringed 'in the same way that an automobile engine for propulsion exists in a car even when the car is turned off.'" INVT at 1373 (quoting Finjan at 1205). "The presence of that programming in the accused products was all that was necessary for establishing infringement." Id. "In other words, the claims recite[d] a device with the capability of performing the recited functions when in operation without any modification or further programming." Id. at 1374. "To determine if an accused device is a device with the 'capability' of performing the recited functions, it must be able to perform those functions when it is activated and put into operation." Id. at 1375. Accordingly, the Federal Circuit has established that for infringement of:

a claim that recites capability and not actual operation, an accused device "need only be capable of operating" in the described mode. Intel Corp. v. U.S. Int'l Trade Comm'n, 946 F.2d 821, 832 (Fed. Cir. 1991). Thus, depending on the claims, "an accused device may be found to infringe if it is reasonably capable of satisfying the claim limitations, even though it may also be capable of noninfringing modes of operation." Hilgraeve Corp. v. Symantec Corp., 265 F.3d 1336, 1343 (Fed. Cir. 2001).

Finjan, 626 F.3d at 1204 (emphasis added).

Moreover, the Federal Circuit has held that an accused device is considered "reasonably capable" of satisfying the claim limitations when one can enable the mode that would infringe "without significant alteration." See INVT, 46 F.4th at 1373-75 ("We held [in Silicon Graphics and Fantasy Sports] that the apparatus claim directed to a computer, claimed in functional terms, is nonetheless infringed so long as the product is designed in such a way as to enable a user of that [product] to utilize the function . . . without having to modify [the product]-i.e., capable of the functions.") (quoting Silicon Graphics, Inc. v. ATI Techs., Inc., 607 F.3d 784, 795 (Fed. Cir. 2010) and Fantasy Sports Props., Inc. v. Sportsline.com, Inc., 287 F.3d 1108, 1118 (Fed. Cir. 2002) (internal quotation marks omitted) (emphasis added); see also Versata Software, Inc. v. SAP Am., Inc., 717 F.3d 1255, 1262 (Fed. Cir. 2013) ("[A] device does not infringe simply because it is possible to alter it in a way that would satisfy all the limitations of a patent claim[.]") (quoting High Tech Med. Instrumentation v. New Image Indus., Inc., 49 F.3d 1551, 1555 (Fed. Cir. 1995).

In sum, when the asserted claims recite capability, our case law supports finding infringement by a 'reasonably capable' accused device on a case-by-case basis particularly where . . . there is evidence that the accused device is actually used in an infringing manner and can be so used without significant alterations."

Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1217 (Fed. Cir. 2014) (emphasis added).

IV. LAW AND ANALYSIS

A. Claim Interpretation Arguments and Construction

As noted above, "[w]hether infringement requires actual performance of the recited functions by the accused device depends on the claim language." INVT, 46 F.4th at 1371. Beyond the distinction noted between method claims and apparatus claims, "differences [likewise] exist between apparatus claims . . . depending on the claim language." Id. at 1376. In other words, regardless of whether the asserted claims are drawn to capability or require actual operation, the Federal Circuit has cautioned that "in every infringement analysis, the language of the claims, as well as the nature of the accused product, dictates whether an infringement has occurred." Finjan at 1204 (quoting Fantasy Sports Props. v. Sportsline.com, Inc., 287 F.3d 1108, 1118 (Fed. Cir. 2002)).

Starting with the language of the asserted claims, the parties agree that the following limitations are at issue in this inter partes proceeding:

Masimo Response at 8.

As shown above, the common term in each limitation is "configured to." Despite the centrality of this limitation to the infringement question presented, each party has made relatively tentative arguments about the proper construction for this claim term. Apple argues throughout this inter partes proceeding that there is something approaching a different standard, as a matter of law, when a claim includes the limitation "configured to" as opposed to "capable of." Apple states that:

Controlling Federal Circuit precedent holds that the plain meaning of "'configured to'" is synonymous with "'made to'" or "'designed to'" "accomplish [a] specified objective"-and that the term is "narrower" than claims reciting a device "capable of" a particular function. Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 F.3d 1335, 1349 (Fed. Cir. 2012); In re Man Mach. Interface Techs., 822 F.3d 1282, 1286 (Fed. Cir. 2016) (explaining "configured to" "has [a] narrower meaning" than "capable of," and means "made or designed to").

Apple Response at 3.

However, it is notable that in both Aspex and Man Mach, the Federal Circuit was primarily concerned with construing the term "adapted to." See Aspex at 1349; Man Mach at 1286. That said, in each of these cases when construing the term "adapted to," the Federal Circuit pointed out that the terms "made to," "designed to," or "configured to" were synonymous with "adapted to" but that "adopted to" could also be used more broadly to mean "capable of" (thereby implying that "configured to" has a narrower meaning). Id.

Conversely, in challenging Apple's claim construction arguments, Masimo raises the construction of the term "configured to" from district court cases. See Masimo Response at 11 (citing TQ Delta LLC v. Adran, Inc., 2021 WL 1200595 (D. Del. Mar. 30, 2021) where the court held the phrase means "includ[ing] the necessary hardware and software for performing the functionality recited in the claim without the need to rebuild, rewrite or recompile the code for, or redesign any of that hardware or software.").

Neither party appears to offer an express construction but, instead, both rely on other cases involving different patents where the court construed the limitation "configured to" from the relevant claims. Most significantly, neither party cites any intrinsic evidence from the asserted patents to support their arguments. Accordingly, the EOE Branch has looked to additional authority for construing the "configured to" claim limitation. In Wanker v. United States, the Federal Government contended that the term "configured to" "should be given its plain and ordinary meaning, which is 'programmed to.'" Wanker, 152 Fed. Cl. 219, 253-254 (2021) (citing Gov't's Op. Cl. Constr. Br. at 24-25). According to the Federal Government in this case, "the Federal Circuit has recognized that the plain and ordinary meaning of the term 'configured to' is synonymous with 'made to' or 'designed to,' in contrast to being 'merely capable of' or 'suitable for.'" Id. (citing Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 F.3d 1335, 1349 (Fed. Cir. 2012)). Specifically, the Federal Government argued that "the plain and ordinary meaning of 'configured to' in the asserted patents should be 'programmed to,' as the invention is computer-implemented technology. Id. (emphasis added) ("In the context of computers and similar technology, courts have construed the term 'configured to' to mean 'programmed to,' as opposed to being merely capable of perform a task.") (citing, e.g., Wapp Tech Ltd. P'ship v. Seattle SpinCo, Inc., Civ. Action Nos. 4:18-CV-469, 4:18-CV-501, 4:18-CV-519, 2020 U.S. Dist. LEXIS 73089, 2020 WL 1983087, at *19-*20 (E.D. Tex. Apr. 27, 2020) (construing "configured to" to mean "actually programmed to.")). There is no dispute that the asserted patents constitute computer-implemented technology. See Masimo Response at 11.

Accordingly, the EOE Branch has determined to adopt the position the Federal Government has taken previously that the claim term "configured to" should be construed to mean "programmed to, as opposed to being merely capable of, performing a task."

A. Findings of Fact Based on the Administrative Record

1. iPhones Used by Masimo to Pair the Redesigned Watches Were Jailbroken For Installation of Third-Party Software

Apple argues that the iPhones used by Masimo to pair the Redesigned Watches were jailbroken. See Apple Reply at 2 ("Complainants have resorted to hacking, or 'jailbreaking,' iPhones"). As noted above, jailbreaking is defined as a modification to a device that "permits the circumvention of computer programs on mobile phones to enable interoperability of non-vendor-approved software applications[.]" Exemption to Prohibition on Circumvention of Copyright Protection Systems for Access Control Technologies, 77 Fed. Reg. 65260, 65263 (Oct. 26, 2012) (codified at 37 C.F.R. 201.40); see also Masimo Sur-Reply at 9; see also Apple Reply at 9-12 ("Only after jailbreaking the device can users access and download unauthorized applications[.]"). Significantly, Apple has provided an expert declaration stating that Legizmo Lighthouse (i.e., the software that Masimo has installed on the two iPhones used to the pair the Redesigned Watches) is "third-party application that cannot be installed on an iPhone unless ... the iPhone is 'jailbroken.'" Apple Reply at 9; see also Crowell Decl. at 21-24, 30-32. Masimo does not contest this. See Masimo Reply at 9-10. Instead, Masimo notes that "[j]ailbreaking has been legal in the United States since the Digital Millennium Copyright Act (DMCA) was passed in 2010" and that it "unlocked publicly available iPhones" using activities that were "permissible, common, and readily known." See Masimo Sur-Reply at 9 (quoting Attachment 52 to Masimo Response). Based on the above, we find that that Masimo's pairing methods used jailbroken iPhones (i.e., iPhones capable of "circumvent[ing] [] computer programs on mobile phones to enable interoperability of non-vendor-approved software applications [(e.g., Legizmo Lighthouse)]") to pair the Redesigned Watches.

2. The Redesigned Watches Do Not Remove the Blood Oximetry Features

Apple argues that it has "entirely removed the Blood Oxygen feature from the Redesigned Watch Products." Ruling Request at 14. Masimo disagrees and argues that Apple "did not remove the pulse oximetry functionality from either the LW/A Watch hardware or its software." Masimo Sur-Reply at 12. Apple states that its redesign involves "hardcod[ing] each Redesigned Watch Product at the factory with a new [[ ]], and [[ ]] [on the] iPhone" to include a new [[ ]]. Apple Reply at 5; see also Apple Slides at 17. Despite certain statements, Apple seems to concede that the Redesigned Watches do not remove but instead "disable the Blood Oxygen feature if any paired Apple Watch has a [[ ]] designation." Apple Reply at 5 (emphasis added). The Redesigned Watches also have the same pulse oximetry hardware as the legacy products found to infringe. See Masimo Sur-Reply at 7. Therefore, we find that the Redesigned Watches do not remove the blood oximetry feature because no hardware or code relating to the blood oximetry functionality has been removed from the Redesigned Watches notwithstanding that functionality has been disabled.

3. Apple's Pairing Method Stores Values on the Redesigned Watches After Pairing That Disables the Blood Oximetry Feature

Apple argues that "[t]he [r]edesigned [Apple] [w]atches [[ ]] that the Blood Oxygen feature is removed" after being paired to an iPhone using Apple's method. Thomas Decl. at 34-35; see also Apple Post Oral Discussion Submission at 10. Specifically, the Redesigned Watches, as part of the [[

]]. See Amended Attachment C to Ruling Request ("Thomas Decl.") at 34; see also Apple Post Oral Discussion Submission at 10. After this [[ ]] occurs on the iPhone, [[ ]] Thomas Decl. at 34-35; see also Apple Post Oral Discussion Submission at 10. After the [[

]] Thomas Decl. at 35; see also Apple Reply at 5; see also Apple Post Oral Discussion Submission at 10. For example, [[ ]] that occurred on the on iPhone during the paring process performed by Apple. See Apple Post-Oral Discussion Submission at 11. According to Apple, the presence of this [[ ]] prevents a user from using the "[b]lood [o]xygen feature ... to take a measurement or to enable background blood measurements." Thomas Decl. at 91-92; see also Apple Post Oral Discussion Submission at 11. As explained by Apple's expert, when [[

]], the [r]edesigned [Apple] [w]atch will (i) prevent the Watch from engaging in any pulse oximetry functionality or measurement, (ii) prevent the user from enabling any pulse oximetry functionality or measurement, including Blood Oxygen feature measurements or background measurements, and (iii) display a screen indicating that the Blood Oxygen feature is unavailable[.]" Thomas Decl. at 35, 41; see also Apple Post Oral Discussion Submission at 10; see also Masimo Post Oral Discussion Submission at 15.

With the exception of Massimo arguing that, through certain modifications, it was able to enable the blood oximetry features using its pairing methods discussed above, Masimo does not dispute Apple's description regarding the operation of the [[ ]] the Redesigned Watches when paired using Apple's method, as designed and programmed for use of the Redesigned Watches. See Masimo Post Oral Discussion Submission at 15. Specifically, Masimo argues that "Apple's [[ ]] from its 'proper pairing' did not cause the [[ ]]" and "Masimo accessed the blood oxygen feature on the very same LW/A Watches after Apple had already paired them." Masimo Post-Oral Discussion Submission at 15 (emphasis added). Notwithstanding Masimo's infringement arguments addressed below in relation to its pairing methods, we find that Apple's pairing method does store values on the Redesigned Watch after pairing and that those values disable the blood oximetry features on the Redesigned Watch.

4. Masimo's Pairing Methods Modifies the Operation of the Redesigned Watch by Enabling Blood Oximetry Functionality that is Disabled Under The Original and Intended Operating Configuration

Apple argues that Masimo's "pairing [] caused modifications within the Redesigned Watch Products themselves[.]" Apple Post-Oral Discussion Submission at 11. Specifically, Apple argues that the "software on the Redesigned Watch products [has] been changed" because "the Redesigned Watch Products did not block blood oxygen measurements when paired" using Masimo's pairing methods. Apple Post-Oral Discussion Submission at 13. According to Apple, Masimo's pairing of Redesigned Watches "corrupt[ed]" the pairing process because it "materially change[s] the configuration of the of the Redesigned Watch Products, [[

]] Apple Post Oral Discussion Submission at 3. Masimo disagrees and argues that using its paring methods "to [enable] the pulse oximetry functionality already present in the LW/A Watch does not constitute a 'modification' of the LW/A Watches" and "Apple never showed that Masimo's pairing changed any [[ ]] LW/A Watches." Masimo Post-Oral Discussion Submission at 15-16. As discussed above, Apple's [[

]] Thomas Decl. at 14-35, 41; see also Apple Post Oral Discussion Submission at 10, 14; see also Masimo Post Oral Discussion Submission at 15. While it is clear that Masimo's pairing method modifies the operation of the Redesigned Watches by enabling blood oximetry functionality that would otherwise be disabled absent the jailbreaking and software installation above, neither party has provided a detailed explanation regarding how Masimo's pairing method altered the [[ ]] or modified the watch itself.

B. Under the Claim Construction of "Configured To" Adopted Above, Apple's Redesigned Watches as Designed and Manufactured For Importation and Sale in the United States are Not "Programmed To" Practice The Asserted Patent Claims

As indicated above, the EOE Branch has determined to adopt the position that the Federal Government has taken previously that "configured to" should be given its plain and ordinary meaning and, as such, construed to mean "programmed to, as opposed to being merely capable of, performing a task," specifically the blood oximetry functionality under consideration. In this dispute, Apple's Redesigned Watches, as designed and manufactured for importation and sale in the United States without modification, are not programmed for this purpose. Instead, they are programmed to prevent a user from accessing this functionality because, as noted above, we found that Apple's pairing method does store values on the Redesigned Watch after pairing and that those values disable the blood oximetry features on the Redesigned Watch. We also found, with the exception of Massimo arguing, through certain modifications, it was able to enable the blood oximetry features using its pairing methods, that Masimo does not dispute Apple's description regarding the operation of the [[ ]] when paired using Apple's method, as designed and programmed for use of the Redesigned Watches that disable the functionality.

Under the construction above, the claims are directed to a structure in an accused device that is programmed to perform a task, namely measuring an oxygen saturation of a user or determining measurements of a physiological parameter of a user. See Revolution Eyewear, Inc. v. Aspex Eyewear, Inc., 563 F.3d 1358, 1369 (Fed. Cir. 2009) ("In High Tech, the claim at issue was directed to a hand-held endoscope for dental work, comprising a body member and a camera disposed in the body member, with the camera 'being rotatably coupled to said body member.' . . . The first factual distinction between High Tech and this case is clear from the claim language. The claim in High Tech requires a structure: a camera 'rotatably coupled' to a body member."); see also Nazomi Communs., Inc. v. Nokia Corp., 739 F.3d 1339, 1346 (Fed. Cir. 2014) ("Here, the structure (i.e., JTEK software) is necessary to enable Jazelle hardware to process stack-based instructions[.]").

As such, this dispute more resembles cases such as High Tech Medical Instrumentation v. New Image Industries, 49 F.3d 1551 (Fed. Cir. 1995) and Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316 (Fed. Cir. 2001) rather than the "capability" cases, such as Intel Corp. v. U.S. Int'l Trade Comm'n, 946 F.2d 821 (Fed. Cir. 1991) and Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197 (Fed. Cir. 2010), that are discussed further below. In High Tech, as noted above, the claim at issue was directed to a hand-held endoscope for dental work, comprising a body member and a camera disposed in the body member, with the camera "being rotatably coupled to said body member." Id. at 1552. While the district court found infringement because in the accused product had a "camera [that was] 'rotatably coupled to the body member' when the set screws [were] loosened or removed," the Federal Circuit reversed based on the reasoning that the accused camera "was not rotatable within its housing unless [it was] altered, at least to the extent of removing or loosening the set screws that secure the camera to the housing." Id. at 1556. (emphasis added).

Accordingly, the Federal Circuit has confirmed that cases such as High Tech are distinguishable from the capability cases, notably based on their respective claim language (requiring a structure rather than a capacity to perform a function and because of the alterations needed to perform the function. See Revolution Eyewear, 563 F.3d at 1370 ("The second factual distinction between High Tech and this case is even more obvious: the camera in High Tech has to be altered for it to be 'rotatably coupled' to a body member, while Revolution's primary frame does not need to be altered in any way for it to be 'capable of engaging' magnetic members from the top.") (emphasis added).

Telemac is likewise relevant on this point. In that case, as here, Telemac, the patent owner, "contended that, even though Topp [the accused infringer] has chosen not to permit [operation of the functionality], the capability of [that functionality] is nonetheless present in the [accused device's] source code." Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1330 (Fed. Cir. 2001) (emphasis added). According to the patent owner, because the accused device was capable of being modified to perform the functionality it was infringing. The Federal Circuit disagreed, since where "a device is capable of being modified to operate in an infringing manner is not sufficient, by itself, to support a finding of infringement. In this case, due to a restriction built into the software program stored in the telephone's memory, a user of Topp's system is prevented from directly placing international calls. Therefore, international rates, and the calculation of charges for such calls, are not included in the billing algorithm of the accused device. The district court correctly concluded that Telemac's allegations of literal infringement must fail." Telemac Cellular Corp., 247 F.3d at 1330 (emphasis added). Due to the "restriction built into the software," the infringement allegation failed, notwithstanding that the capability was "nonetheless present" in the accused device. Similarly, Masimo noted that "Apple (1) added [[ ]] to the [[ ]] and infringing Apple Watches and (2) changed [[ ]]. Masimo Response at 2. In both cases, a restriction stored in memory precludes a finding of infringement.

Accordingly, in applying these cases to the factual findings above establish that the original and intended operating configuration of the device must be altered - as in High Tech by loosening the set screws and in this inter partes proceeding by jailbreaking the iPhone paired with the Redesigned Watch that needed for its operation and then installing otherwise restricted software - for accessing the functionality under consideration. The fact that it is possible to alter the operation of the Redesigned Watches in this inter partes proceeding, as with the camera in High Tech, "is not enough, by itself, to justify a finding that the manufacture and sale of the [accused articles] infringe [the] patent rights" at issue. High Tech at 1556 (emphasis added). "Of course, if a device is designed to be altered or assembled before operation, the manufacturer may be held liable for infringement if the device, as altered or assembled, infringes a valid patent." Id. (emphasis added). However, as in High Tech, that principle is inapplicable here because the record provides no reason to disregard the technological restrictions that determine the character of the original and intended operating configuration of the Redesign Watches before any modification.

D. Notwithstanding the Claim Construction Adopted Above, Under A "Capability" Approach the Redesigned Watches Do Not Infringe Based on the Reasonably Capable Test

The Federal Circuit has held that, to infringe a claim that recites capability and not actual operation, an accused device "need only be capable of operating" in the described mode. Intel Corp., 946 F.2d at 832. "Thus, depending on the claims, 'an accused device may be found to infringe if it is reasonably capable of satisfying the claim limitations, even though it may also be capable of noninfringing modes of operation.'" Finjan at 1204 (quoting Hilgraeve Corp. v. Symantec Corp., 265 F.3d 1336, 1343 (Fed. Cir. 2001); see also Ball Aerosol & Specialty Container, Inc. v. Ltd. Brands, Inc., 555 F.3d 984, 994 (Fed. Cir. 2009) (noting that the "reasonably capable" test applies "only to claim language that specifies that the claim is drawn to capability"). Finjan further notes that claims describing capability do not require that "any software components be 'active' or 'enabled[.]'" Id. Additionally, when evaluating its precedent, the Federal Circuit in Finjan noted that infringement occurs when the code at issue is "written in such a way as to enable a user of that software to utilize the function . . . without having to modify that code." Id. (quoting Fantasy Sports Props. v. Sportsline.com, Inc., 287 F.3d 1108, 1118 (Fed. Cir. 2002). More recently, the Federal Circuit has confirmed that, in order to "determine whether an accused device is a device with the 'capability' of performing the recited functions, it must be able to perform those functions when it is activated and put into operation." INVT SPE LLC, 46 F.4th at 1375 (emphasis added). As such, "where claim language recites 'capability, as opposed to actual operation,' an apparatus that is 'reasonably capable' of performing the claimed functions 'without significant alterations' can infringe those claims." INVT SPE LLC, 46 F.4th at 1376 (quoting ParkerVision, Inc., 903 F.3d at 1362). Moreover, "[i]n contexts involving software functionality, [the Federal Circuit has] never suggested that reasonable capability can be established without any evidence or undisputed knowledge of an instance that the accused product performs the claimed function when placed in operation."

Based on the findings of fact above, we conclude that Masimo was only able to access the functionality it has raised in this dispute by means of significant alteration. To repeat, when testing the Redesigned Watches, Masimo paired them to iPhones using two different methods. Both methods involve paring the Redesigned Watches with a "jailbroken" iPhone. See Masimo Sur-Reply at 10. For the first method, Masimo used an iPhone X (i.e., an outdated iPhone) running iOS 15 (i.e., an outdated version of the iOS operating system) and installed the Legizmo Lighthouse application onto the phone. Madisetti Decl. at 67-92; see also Masimo Slides at 24; see also Apple Post Oral Discussion Submission at 8-9 ("Apple blocks the current generation of Apple Watch models (Series 9 and Ultra 2) from pairing with iPhone X or older models" and "to ensure security, current versions of Apple Watches, including the Series 9 and Ultra 2, are configured by Apple to pair only with the most recent iOS release [i.e., iOS 17.0 or later].") (citing Crowell Decl. at 15-19). Legizmo Lighthouse is a publicly available "third-party application that cannot be installed on an iPhone unless ... the iphone is 'jailbroken.'" Apple Reply at 9; see also Crowell Decl. at 21-24, 30-32. The Legizmo Lighthouse application allows users "to pair an outdated iPhone and/or iOS to a 'normally' incompatible Apple Watch." Apple Reply at 11; see also Masimo Sur-Reply at 8. When employing this third-party application, Masimo was able to pair the modified iPhone with the redesigned LW/A Series 9 Apple Watch. Masimo Response at 7, 11; Madisetti Decl. at 75. After pairing, "the Health application and the Watch application on the iPhone identified the availability of the Blood Oxygen feature" and "Masimo [was able to use] the [redesigned] LW/A Series 9 to measure blood oxygen."

Accordingly, Masimo was only able to access the functionality in question after (1) jailbreaking the iPhones used for pairing with the Redesigned Watches that is needed to activate the Watches and put them into operation; and (2) installing third-party software in the form of the Legizmo Lighthouse application. Moreover, there is no dispute in this proceeding that Masimo was only able to access this functionality using the modifications referenced above.

In light of these findings above, the Federal Circuit's decision in Nazomi Communs., Inc. v. Nokia Corp., 739 F.3d 1339 (Fed. Cir. 2014), is instructive. In that case, the Federal Circuit noted that "an apparatus claim directed to a computer that is claimed in functional terms is nonetheless infringed so long as the product is designed in such a way as to enable the user of that [product] to utilize the function without having to modify the product." Id. at 1345 (quoting Silicon Graphics, 607 F.3d at 794) (emphasis added). The same analysis applies here since, as in Nazomi, it is undisputed that the hardware in question is physically present as part of the Apple Redesigned Watches but the hardware is not functional without the software (i.e., pairing to an iPhone. Moreover, the pulse oximetry functionality that Masimo identifies was performed with the following modifications: jailbreaking the iPhones and installing otherwise restricted software that, but for the jailbreaking, would not have been feasible. Therefore, as in Nazomi, this would appear to resolve the issue of infringement.

However, Masimo, like Nazomi, argues that jailbreaking the phones and installation of the Legizmo software is not a modification that precludes a finding of infringement. We conclude on the record before us that, like the Federal Circuit in Nazomi, jailbreaking and installation of this software "clearly constitutes a 'modification' of the accused products." Id. at 1345. Additionally, in Typhoon Touch Technologies, Inc. v. Dell, Inc., 659 F.3d 1376 (Fed Cir. 2011), Typhoon made the same argument as Nazomi, namely that the accused devices infringed if they had "the capability of being configured or programmed to perform the stated function," even though the accused devices were not structured to perform that stated function as sold. Id. at 1380. The Federal Circuit disagreed, finding that an accused device must be presently structured to store at least one data collection application. Id. at 1381. Here, as in Nazomi and Typhoon, the products designed and manufactured by Apple cannot infringe without modification-the modification of jailbreaking the iPhones that is needed for pairing with the Redesigned Watches for their operation and the installation of the software. On this basis, we conclude that Redesigned Watches do not infringe. See Telemac, 247 F.3d at 1326, 1330 (finding accused product non-infringing where the functionality present in the source code was blocked and therefore, without modification, the function could not be performed.).

V. HOLDING

We find that Apple has met it burden to establish that the articles at issue do not infringe any of the asserted patent claims mentioned above. Accordingly, we find that the articles at issue are not subject to the LEO issued as a result of Inv. No. 337-TA-1276.

The decision is limited to the specific facts set forth herein. If articles differ in any material way from the articles at issue described above, or if future importations vary from the facts stipulated to herein, this decision shall not be binding on CBP as provided for in 19 C.F.R. 177.2(b)(1), (2), (4), and 177.9(b)(1) and (2).

Sincerely,

Dax Terrill
Chief, Exclusion Order Enforcement Branch

CC: Ms. Sheila N. Swaroop
Knobbe Martens
2040 Main St., 14th Fl.
Irvine, CA 92614
[email protected]

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[1] Although claim construction is a question of law, the consideration of extrinsic evidence may constitute a subsidiary finding of fact. Teva, 135 S. Ct. at 841, 190 L. Ed. 2d at 733.

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Apple Watch Series 8

Apple Watch Series 7

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