Apple flexes lobbying power as Apple Watch ban comes before Biden next week
Apple is boosting its lobbying might as President Biden nears a decision next week on whether to block a potential Apple Watch ban.
The U.S. International Trade Commission (ITC) ruled in December that Apple infringed on medical device company AliveCor’s wearable electrocardiogram patents. The commission’s ruling could result in an import ban on popular Apple Watch models, unless the Biden administration steps in.
Apple responded by contracting with Shara Aranoff, a lobbyist at Covington & Burling who chaired the ITC during the Obama administration.
The former Democratic commissioner has been lobbying on trade, intellectual property and health issues since her hiring in early January, according to a recent document filed with Congress.
The apparent effort to win over the White House is the latest lobbying push by Apple, which leans on former congressional staffers and federal officials to relay its message in the nation’s capital.
“Apple has unlimited resources. They’re gonna go after everyone they can get and that’s what they’re doing,” said Priya Abani, CEO of AliveCor. “We are just a startup.”
White House decision looms
Biden must decide by Monday whether to veto the ITC ruling or let the dispute move forward in court.
AliveCor has filed lawsuits accusing Apple of stealing its technology and taking part in “monopolistic conduct.”
The Mountain View, Calif., startup, which employs around 150 people, first shared its wearable electrocardiogram (ECG) sensor with Apple in 2015.
AliveCor told The Hill that it believed that it had a good relationship with the Silicon Valley giant and went on to sell an ECG accessory for the Apple Watch.
But in 2018, Apple launched an Apple Watch with a built-in ECG sensor and made third-party heart monitoring software incompatible with the product, forcing AliveCor to cancel sales of its product.
“We come up with new technologies, and instead of the ecosystem letting us thrive and continue to build on top of the innovations we already have, Apple cuts us out up front, steals our technology, uses their platform power to scale it, and now is basically saying it’s scaled so it can’t be cut off,” Abani said.
Various app developers and startups have accused Apple of “Sherlocking,” where the Silicon Valley giant monitors an innovative technology, then copies it once the use case is demonstrated, rather than pay startups to license their technology.
In a statement to The Hill, Apple noted that the ITC’s import ban is on hold due to December rulings from the Patent Trial and Appeal Board finding that AliveCor’s patents are invalid.
AliveCor appealed those decisions and hopes to bring the various legal battles — including a recent Apple lawsuit accusing AliveCor of infringing on its patents — before a federal appeals court.
If Biden upholds the ITC ruling, litigation would continue, while a veto would ensure that an Apple Watch ban will not take place.
Startups are closely watching Biden’s decision, given that the president has railed against powerful companies for using their market dominance to crush competition, Abani said.
“You want to make sure that the government and the processes in the country give a fair chance for startups to not just survive, but thrive,” she said.
Why Apple is a lobbying powerhouse
Long a darling on Capitol Hill, Apple has aggressively bolstered its lobbying presence in recent years as lawmakers began to closely scrutinize its market dominance.
Apple spent nearly $9.4 million on lobbying in 2022, the highest figure in the company’s history, according to nonpartisan research group OpenSecrets.
Apple deployed 50 lobbyists, including former aides to Speaker Kevin McCarthy (R-Calif.), former Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Mitch McConnell (R-Ky.), as it successfully defeated bipartisan legislation aimed at lessening the company’s grip on app store purchases.
“Given Apple’s long history of utilizing these revolving door lobbyists and, frankly, the success they’ve had with this strategy, it’s not surprising at all that they’re doing the same thing to try and skirt this decision coming out of the International Trade Commission,” said Cheyenne Hunt, big tech accountability advocate at Public Citizen.
Apple secured a veto in the past
Presidents typically don’t veto ITC rulings, but they have made an exception for Apple.
In 2013, then-President Obama vetoed an ITC ban on Apple iPhone and iPad imports after the commission found that Apple infringed on Samsung’s patents. The administration said that it considered the ban’s “effect on competitive conditions in the U.S. economy and the effect on U.S. consumers.”
At the time, phone carriers and a bipartisan coalition of lawmakers urged Obama to overrule the ITC. It marked the first presidential veto of an ITC product ban since 1987.
This time around, Apple recruited a smaller group of allies in Congress.
Seven House Democrats warned the ITC in October that an import ban “could result in severe negative impacts to businesses and millions of Americans,” pointing to the popularity of the Apple Watch’s heart monitoring system.
Reps. Eric Swalwell (D-Calif.), Zoe Lofgren (D-Calif.), Don Beyer (D-Va.), Anna Eshoo (D-Calif.), Jimmy Panetta (D-Calif.), Linda Sánchez (D-Calif.) and Lou Correa (D-Calif.) authored the letter.
“Leading up to the ITC’s final determination in this case, we encourage close consideration of the public health benefits which Apple’s heart-health monitoring devices bring to the American consumer,” they wrote.
More than 500 individuals wrote to the ITC crediting the Apple Watch’s heart monitor with saving their lives.
Just two lawmakers sided with AliveCor in ITC briefs, along with the Medical Device Manufacturers Association and a handful of companies.
“The lack of enforcement of our patent laws is of grave concern to us, especially as markets continue to consolidate, competition from foreign countries grows, and larger firms exert their influence over smaller firms and start-ups in anti-competitive ways,” Reps. Hank Johnson (D-Ga.) and Lucy McBath (D-Ga.) wrote to the ITC.
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