In a significant development, tech giant Apple is set to remove a crucial health feature from its latest Watch models following a ruling by the US Court of Appeals for the Federal Circuit.

The pulse oximetry feature, allowing users to monitor their blood oxygen levels, will no longer be included in new versions of the Watch.

This move comes amid an ongoing legal battle with Masimo, a prominent health technology company, which alleges that Apple violated its patents related to blood analysis technology.

The dispute resulted in a temporary ban on the sale of Apple Watches over the Christmas period, and the recent court ruling means that the company can no longer sell the models at the center of the legal dispute.

The dispute centers around Masimo's claim that Apple infringed on its patents related to the technology used to analyze blood oxygen levels. Masimo's founder and CEO, Joe Kiani, expressed satisfaction with the court's decision, stating that it affirms the importance of respecting the intellectual rights of American inventors.

Despite Apple's strong disagreement with the ruling, the company has decided to comply with the court's decision. New Watch models will no longer include the pulse oximetry feature, and while existing Watches will remain unaffected, the change may impact Apple's standing in the wearables market.

Apple Watches constitute about a quarter of the global smartwatch market, according to Counterpoint Research. The court ruling has led to a 0.5% decrease in Apple's shares, closing at $182.68.

Industry analysts speculated that the removal of the blood oxygen feature may impact Apple's sales in the health and fitness-focused wearables segment.

The Series 9 and Ultra 2 models sold in the U.S. from Thursday will retain the appearance of previous models, with the blood oxygen feature seemingly disabled in software. Users tapping the app icon for blood oxygen features will be informed that the functionality is no longer available.