OAKLAND, Calif. (CN) — A federal judge on Friday tossed antitrust claims that Apple abused U.S. Patent and Trade Office petitions in a scheme to corner the market on smartphone apps which monitor an Apple Watch wearer's pulse for cardiac irregularities.
U.S District Judge Jeffrey White said Friday that medical device and AI company AliveCor — the first to win the U.S. Food and Drug Administration's clearance for a medical-device accessory to the Apple Watch — failed to show Apple violated antitrust law.
However, he also denied Apple’s attempt to strike one of AliveCor's claims on anti-SLAPP grounds.
AliveCor sued in May 2021 claiming Apple attempted to monopolize the aftermarket for heart rate analysis apps. The court approved the company’s request to add a new theory that Apple instituted proceedings before the U.S. Patent and Trademark Office seeking to invalidate AliveCor’s patents. AliveCor claims those proceedings are designed to retaliate for the lawsuits underway.
In his nine-page order, White noted that since June 2021 Apple has filed 10 petitions on AliveCor’s patents — five of which AliveCor is disputing, claiming the petitions are designed to raise litigation costs. The company says this behavior is “inextricably linked” to underlying anticompetitive conduct, to further impinge competition and damage AliveCor.
Apple argues the Noerr-Pennington doctrine — which grants antitrust immunity to private parties petitioning the government to adopt laws or rulings that may be anticompetitive — shields it from liability. AliveCor responded that Apple’s behavior falls into the “sham litigation” exception within that doctrine.
White found AliveCor did not provide evidence as to whether Apple considered how successful the petitions would be before suing, to prove that Apple is suing regardless of their ability to win. However, he said the complaint plausibly shows that Apple’s petitions constitute sham litigation.
“But if it accepts AliveCor’s narrow view of the relevant IPR proceedings, the court is not persuaded that the five challenged IPR petitions are sufficient to qualify as a pattern under USS-POSCO,” White wrote.
“And if the court considers all ten IPR petitions, which comes closer to establishing a pattern, AliveCor’s allegations still fall short because they allege nothing about these other petitions, including their success rate or facts establishing that Apple instituted them without regard to their success.”
White also found AliveCor failed to prove how Apple’s IPR petitions are a critical step in the anticompetitive injury claim on changes to the watchOS heart rate app.
AliveCor did not establish how the petition proceedings reflected anticompetitive conduct to maintain control over changes to the watchOS heart rate app, White found, adding the complaint lacked a legal precedent where litigation has prevailed showing the doctrine applied to petitioning conduct in the same way, and said he did not think it is broad enough to encompass the claims.
However, White denied Apple’s request to strike the unfair competition claim on anti-SLAPP grounds. AliveCor had argued the Apple's petitions were incidental to the core antitrust claim and not protected under the anti-SLAPP statute, and White agreed.
“The gravamen of its suit is its antitrust claims based on Apple’s alleged monopolization of the aftermarket for heartrate analysis apps.” He denied Apple’s motion and request for attorneys’ fees. He also denied AliveCor’s request for attorney’s fees, saying he did not agree that Apple’s motion was “frivolous or solely intended to cause unnecessary delay” under the anti-SLAPP statute.
White dismissed the amended complaint without leave to amend.
Attorneys for both parties did not respond to requests for comment before press time. Both return to court Oct. 20 for dispositive motions.
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