It isn't clear to me if Apple's internal team working on this was the original plan - think "embrace, extend, extinguish", or "we'll do the basics, everything else is a 'third-party opportunity'" - or if they were formed as a backstop in the event an acquisition or licensing deal didn't happen.

See also the current situation with AliveCor over ECG tech in the Apple Watch.

Bottom line, Masimo wants to be paid - which I get - but I think the case will also try to settle whether or not Apple (or anyone) can integrate these features in something that (legally speaking) isn't a medical device without paying licensing fees of some kind.