IP Law Daily, PATENT NEWS: Masimo challenges CBP’s ex parte ruling permitting Apple Watch imports, (Aug 22, 2025)

By Saurabh Kashyap, B.A., M.A., LL.B., LL.M.

Masimo alleges U.S. Customs and Border Protection’s August 2025 decision unlawfully circumvents ITC’s exclusion order, enabling indirect infringement through Apple Watch-iPhone pairing.

Masimo Corporation has filed a complaint in the U.S. District Court for the District of Columbia against the U.S. Customs and Border Protection (CBP) and several senior federal officials, including Homeland Security Secretary Kristi Noem, CBP Commissioner Rodney Scott, and Executive Director Alice Kipel. The action challenges CBP’s August 2025 ex parte ruling permitting the importation of certain Apple Watch models that, when paired with iPhones already in the U.S., allegedly perform patented functionality previously barred under an Limited Exclusion Order (LEO) issued by the International Trade Commission (Masimo Corp. v. U.S. Customs & Border Protection, No. 1:25-cv-2749 (D.D.C. filed Aug. 20, 2025)).

Background. The plaintiff, Masimo Corporation, is a Delaware-incorporated medical technology company based in Irvine, California, best known for its non-invasive patient monitoring devices. The company develops and licenses technologies such as pulse oximetry, which measures blood oxygen saturation using light-based methods.

The defendants include CBP, a sub-agency of the Department of Homeland Security tasked with enforcing exclusion orders issued by the U.S. International Trade Commission (ITC). CBP operates under the supervision of Secretary Noem, with Commissioner Scott and Director Kipel overseeing regulatory rulings. The lawsuit arises from CBP’s decision to reverse an earlier enforcement ruling concerning Apple’s allegedly infringing wearables.

Masimo’s complaint centers on U.S. Patent Nos. 10,912,502 (the ’502 patent) and 10,945,648 (the ’648 patent), both entitled User-Worn Device for Noninvasively Measuring a Physiological Parameter of a User. These patents cover wearable medical devices that use arrays of LEDs and photodiodes to measure analytes, such as oxygen saturation, in blood by analyzing the attenuation of specific light wavelengths.

The ITC previously determined that Apple’s Series 8 Watch infringed claims 22 and 28 of the ’502 patent and claims 12, 24, and 30 of the ’648 patent. A Limited Exclusion Order and a Cease and Desist Order were issued on October 26, 2023, prohibiting the importation and sale of infringing Apple Watches.

Procedural history. The conflict began in August 2021 when the ITC instituted an investigation based on Masimo and Cercacor Laboratories’ complaints. In October 2023, the Commission concluded that Apple violated §337 of the Tariff Act of 1930, 19 U.S.C. § 1337. The LEO, which took effect on December 26, 2023, after the President declined to disapprove it, excluded “wearable electronic devices with light-based pulse oximetry functionality” manufactured or imported by Apple.

Apple sought regulatory clearance to import redesigned watches with the pulse oximetry function disabled. In January 2024, CBP issued a ruling, following a full inter partes proceeding, allowing the importation of these redesigned devices. Apple’s second request—proposing to move certain processing steps to a paired iPhone—was denied by CBP in January 2025.

However, on August 1, 2025, CBP issued a third, ex parte ruling that permitted Apple to import these watch-plus-phone combinations. Masimo only learned of this decision after Apple’s public announcement on August 14, 2025, declaring that the blood oxygen monitoring functionality would be restored through a software update enabled by a “recent U.S. Customs ruling.”

Arbitrary and capricious agency action. In its first count, Masimo alleges that CBP’s August 2025 ruling is arbitrary, capricious, and contrary to the Administrative Procedure Act (APA), 5 U.S.C. § 706(2)(A). Masimo asserts that CBP reversed its earlier inter partes decision without notice or changed circumstances, failed to provide Masimo an opportunity to be heard, and arbitrarily limited its enforcement analysis to direct infringement while ignoring indirect infringement theories.

Citing Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983), Masimo contends that CBP failed to consider an important aspect of the problem—namely, that Apple’s software update allows the patented functionality to be restored once the imported watches are paired with iPhones. The ruling, Masimo claims, runs counter to CBP’s January 2025 position and undermines the ITC’s authority.

CBP’s policy of not considering indirect infringement allegedly allows importers to evade exclusion orders by splitting infringing functionality across devices—a loophole Masimo argues is inconsistent with the agency’s statutory duty to enforce ITC determinations faithfully.

Statutory authority. Masimo’s second claim alleges that CBP exceeded its statutory authority under 19 U.S.C. § 1337 by effectively modifying the ITC’s exclusion order. Masimo emphasizes that CBP is tasked only with enforcing, not interpreting or altering, the scope of LEOs.

The complaint notes that Apple’s appeal of the ITC decision is still pending in the Federal Circuit (Apple Inc. v. ITC, No. 24-1285), and the exclusion order remains binding until overturned. By redefining the scope of coverage to exclude devices that only indirectly infringe, Masimo argues, CBP usurped the ITC’s exclusive jurisdiction over patent-based trade enforcement.

The company cites Kyocera Wireless Corp. v. ITC, 545 F.3d 1340 (Fed. Cir. 2008), to support the proposition that limited exclusion orders apply specifically to named parties and that CBP’s enforcement role is ministerial—not adjudicative. Similarly, Wirtgen Am., Inc. v. United States, 447 F. Supp. 3d 1359 (Ct. Int’l Trade 2020), is invoked to underscore CBP’s obligation to apply, not reinterpret, the exclusion order's plain terms.

Due process. Masimo’s third and final claim invokes the Due Process Clause of the Fifth Amendment. The complaint alleges that CBP deprived Masimo of its property interest in its patents and in the ITC’s exclusion order by issuing a ruling without notice or an opportunity to be heard.

Relying on Mathews v. Eldridge, 424 U.S. 319 (1976), Masimo applies the three-part balancing test: (1) Masimo’s interest in patent enforcement is substantial; (2) the risk of error in ex parte proceedings is high; and (3) the administrative burden of holding an inter partes hearing is minimal. Masimo also cites Florida Prepaid Postsecondary Educ. Expense Bd. v. College Savings Bank, 527 U.S. 627 (1999), confirming that patents are constitutionally protected property, and Spansion, Inc. v. ITC, 629 F.3d 1331 (Fed. Cir. 2010), which recognizes the enforceability of exclusion orders as a legally protected interest.

The company argues that CBP's ruling bypassed established procedural norms. In January 2024, the agency had conducted an inter partes proceeding with full access to source code and hardware samples. In contrast, the August 2025 ruling was delivered unilaterally, without Masimo’s knowledge, and was only revealed after Apple’s public press release.

Reliefs. Masimo seeks an immediate temporary restraining order (TRO), a preliminary and permanent injunction against CBP's August 2025 ruling, a declaration that CBP’s action was unlawful, and an order compelling CBP to adhere to its January 2024 decision. Additionally, Masimo requests attorney fees under 42 U.S.C. § 1988 and other relief deemed just and proper.

The Case is No. 1:25-cv-02749-ACR.

Judge: Reyes, A.

Attorneys: Derek L. Shaffer (Quinn Emanuel Urquhart & Sullivan, LLP) for Masimo Corp. Guy Eddon, U.S. Department of Justice, for United States Customs and Border Protection.

Companies: Masimo Corp.

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