Apple, of course, rejects this characterization and says the company respects other companies’ intellectual property. In Apple’s defense, it’s fair to assume that Jobs was speaking metaphorically, and not copping to a crime, when he said that the company stole.
On the other hand, Masimo has presented evidence that before launching Apple Watch models with competing technology, Apple hired the chief medical officer of Masimo and the chief technical officer of Cercacor, and then started looking “next level down.” Apple opened offices near Masimo’s and, according to Masimo, eventually hired more than 20 people from Masimo and Cercacor.
Let’s back up. Masimo, while not a household name, is a recognized world leader in patient-monitoring technologies for hospitals. It has possibly the best light-based pulse oximeter, which uses red and near-infrared light emitters and detectors to see how red, and thus how oxygen-rich, the blood in the arteries is.
Partly thanks to software that efficiently extracts signal from noise, Masimo’s pulse oximeter works even when patients are moving around or when they have a weak pulse. By using it on premature infants with underdeveloped lungs, hospitals can give them precisely the amount of oxygen they need — a good thing because too much oxygen causes blindness. It’s also good for patients on heavy opioids, who sometimes stop breathing because the opioids dull the pain they’re supposed to feel when they don’t catch a breath.
It’s agreed by both sides that Apple sought a meeting with Masimo when it was exploring adding pulse oximetry to the Apple Watch. Apple signed a confidentiality agreement. A meeting was held in 2013. At this point, stories differ. Joe Kiani, the electrical engineer who founded Masimo in 1989 and remains its chief executive officer, told me on Friday that Apple decided that rather than pay for licenses to use the technology, do a joint venture, or buy Masimo, Cercacor or both, it decided to do “strategic hiring” of key employees. Apple says it concluded that Masimo’s technology wasn’t suited for a consumer device, so it went in a different direction. (Although of course it did hire those key Masimo employees.)
