Masimo CEO Joe Kiani ousted from board; Politan wins two seats

Activist investor Politan Capital won the two seats it sought on the board of the medical technology company Masimodefeating founder and CEO Joe Kiani and another director, Chris Chavez, in the shareholder vote.

Masimo shares rose more than 2 percent in extended trading. Politan nominees Darlene Solomon and Bill Jellison will join Politan investment chief Quentin Koffey and former Johnson & Johnson executive Michelle Brennan, who won seats on the board in an earlier proxy fight last year.

“We look forward to getting to know, learning from and working with healthcare and consumer protection professionals to make Masimo an even greater company,” the four directors said in a statement following Thursday's vote.

Overall, Politan's candidates received about twice as many votes as Kiani and Chavez, according to a person familiar with the matter who asked not to be identified in order to speak freely about nonpublic information.

The protracted proxy fight was marked by a bitter legal battle. Masimo, best known for its legal battle with Apple over the use of pulse oximetry technology in the Apple Watch, sued Politan, claiming the proxy statement contained errors. The activist, in turn, sued Masimo, claiming the company rigged the vote count with the help of a powerful shareholder ally.

Masimo's request for an injunction was ultimately denied, although Koffey was charged with contempt of court for leaking the judge's decision under seal. The victory for Politan will likely result in the resignation of CEO Kiani as well as chief operating officer Bilal Muhsin. Kiani and Muhsin have both told shareholders they would resign if Kiani was forced off the board.

REGARD: Masimo CEO on proxy fight