Apple has filed a lawsuit against OpenAI, accusing the artificial intelligence company of misappropriating trade secrets through former Apple employees as OpenAI accelerates its efforts to develop AI-focused consumer hardware.
The lawsuit, filed Friday in a federal court in California, alleges that OpenAI encouraged Apple employees it recruited to share confidential information and even advised them on how to avoid detection when moving to the company. Apple argues that the alleged conduct gave OpenAI an unfair advantage in building its emerging hardware business.
“This case is about Apple’s former employees stealing Apple’s trade secrets for the benefit of OpenAI,” the complaint states. “Apple brings this suit to put a stop to it.”
OpenAI said it is reviewing the lawsuit. In a statement, spokesperson Drew Pusateri said the company has “no interest in other companies’ trade secrets” and remains focused on developing technology that benefits users.
Apple targets former executives and OpenAI hardware unit
The lawsuit names OpenAI, its hardware subsidiary io Products, and two former Apple employees as defendants.
One is Tang Tan, who previously helped design the iPhone, Apple Watch and iPod before becoming OpenAI’s chief hardware officer. The other is Chang Liu, a former Apple electrical engineer whom Apple said worked on some of its most sensitive hardware development projects before joining OpenAI earlier this year.
According to the complaint, Apple launched an internal investigation after suspecting that confidential information had been compromised. The company said it discovered what it described as “a pattern of theft” involving former employees who later accepted positions at OpenAI.
Apple alleges that Liu accessed and downloaded confidential hardware-related files using an Apple-issued device that he retained after leaving the company. It also claims Tan instructed prospective OpenAI recruits who were still employed by Apple to bring “Actual parts” from Apple to job interviews.
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The lawsuit further states that Apple contacted OpenAI in February to raise its concerns during the early stages of its investigation but received no response.
An Apple spokesperson said the company will “always defend our teams’ hard work and innovations, and we are taking all appropriate steps to do so.”
Dispute centers on OpenAI’s hardware ambitions
The legal action strikes at the center of OpenAI’s expanding hardware strategy, an area the company has publicly described as an effort to develop new ways for people to interact with artificial intelligence beyond traditional computing devices.
While OpenAI has not disclosed the exact nature of the product under development, the lawsuit argues that its hardware initiative relies in part on confidential Apple information.
Apple claims OpenAI’s hardware business “rests on the shakiest of foundations,” alleging that the project benefited from improperly obtained trade secrets.
The dispute comes as technology companies increasingly compete to define the next generation of AI-powered consumer devices, building on advances in generative artificial intelligence that followed ChatGPT’s rapid adoption.
Former partners increasingly compete in artificial intelligence
The lawsuit highlights how Apple’s relationship with OpenAI has shifted from collaboration toward direct competition.
The companies partnered in 2024 to integrate ChatGPT into the iPhone as an AI-powered assistance feature when Siri could not adequately answer user requests.
Since then, OpenAI has expanded its hardware ambitions by recruiting former Apple designer Jony Ive to lead development of a new AI-focused device. Last year, OpenAI announced a confidential hardware collaboration with Ive aimed at creating a new interface for interacting with artificial intelligence.
As part of that effort, OpenAI acquired io Products, a product and engineering company co-founded by Ive, Tan and two others, in a transaction valued at nearly $6.5 billion.
The acquisition also prompted separate litigation. Startup iyO Inc. sued Ive and OpenAI Chief Executive Officer Sam Altman for trademark infringement over the similarity between the names “io” and “iyO.” The company also sued a former employee over the alleged disclosure of confidential product drawings and later added trade secret theft claims against Tan.
Legal challenge arrives amid broader competitive pressure
Apple’s lawsuit comes as OpenAI continues to reshape its business while facing growing competition from AI rivals including Anthropic and Google.
Although OpenAI narrowed some of its business initiatives earlier this year to concentrate on ChatGPT, the company has maintained its commitment to developing consumer hardware.
Speaking to The Associated Press in April, OpenAI Chief Financial Officer Sarah Friar said the company expects to introduce consumer hardware toward the end of this year.
The outcome of Apple’s lawsuit could influence not only the relationship between the two companies but also how aggressively technology firms recruit talent and protect intellectual property as competition in the AI hardware market intensifies.
This report is based on reporting by The Associated Press.
Article Topics: Apple | OpenAI | Trade Secrets | Artificial Intelligence | Consumer Hardware | Intellectual Property | Corporate Lawsuit
