Joe Kiani, founder and CEO of Masimo Corporation, has stepped down from his position following a controversial proxy battle with activist hedge fund Politan Capital Management. Masimo, the medical device maker, is legally challenging Apple’s use of blood oxygen sensors in its smartwatches in the U.S. The CEO resigned days after shareholders voted to remove him from the company’s board.
Masimo has appointed Michelle Brennan, a veteran healthcare executive, as interim CEO. The company has also hired financial and legal experts to look at different options for its consumer business. This includes the brands Sound United and health-tracking watches.
The change in leadership might affect the current dispute between Masimo and Apple. Kiani had been a vocal critic of Apple, accusing the tech giant of infringing on Masimo’s patents related to blood oxygen measurement tech. This legal battle led to a ban on Apple Watch sales in the U.S., which was lifted after Apple disabled the feature via a software update.
With Kiani’s departure, speculation has arisen that there could be a possibility of a settlement between the two companies. However, the outcome remains uncertain, as Apple may choose to continue its appeals or push for dismissal of the case.
Masimo’s stock rose 5.4% following the announcement. The company is now actively reviewing its strategy, with updates on value-creation initiatives expected in the near future.
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What puzzles me about this dispute is why Apple was sued only in one jurisdiction, the US, and consequently only disabled blood oxygen measurement there. More pressure could have been put on Apple by litigating in multiple large markets, Does Massimo not hold corresponding patents elsewhere? If not, why not? Did others pip it to the post in filing?; did non-US patent authorities refuse a grant on grounds of lack of novelty, obviousness or something else? A mystery.