Apple sues OpenAI for allegedly stealing hardware trade secrets

Apple sues OpenAI for allegedly stealing hardware trade secrets

Apple has filed a lawsuit in the US District Court for the Northern District of California accusing OpenAI of orchestrating a campaign to steal trade secrets to fuel its own hardware ambitions. The suit, filed Friday, alleges a pattern of theft by OpenAI employees who were formerly employed by Apple.

Apple claims that OpenAI's effort to build a suite of devices — including a smartphone and AI earbuds — is based on misappropriated intellectual property. According to the filing, OpenAI has lured away a vast number of Apple staff, with more than 400 former Apple workers now employed at the AI startup.

"At Apple, our teams are constantly developing breakthrough technologies to create the best products and services in the world, and protecting their work and intellectual property is something we take very seriously,"

Apple spokesperson, via CNET

Allegations of Coordinated Theft

The lawsuit specifically names Tang Tan and Chang Liu as defendants. Tan, the current Chief Hardware Officer at OpenAI, previously spent 24 years at Apple, where he served as vice president of product design for the iPhone and Apple Watch. Apple alleges Tan methodically used confidential information to benefit OpenAI, which included emailing himself data about Apple's suppliers before his departure.

Apple further alleges that Tan exploited the hiring process to extract secrets. The complaint claims Tan asked job applicants currently employed by Apple about unannounced products using project codenames. He allegedly encouraged these candidates to bring actual parts from Apple to interviews for show and tell sessions intended to elicit more confidential information.

Chang Liu, a former senior system electrical engineer who joined OpenAI in January, is also accused of theft. Apple alleges Liu failed to return a company laptop and used it to surreptitiously download dozens of confidential hardware files, including technical specifications, engineering presentations, and proprietary project data regarding unreleased products.

The lawsuit claims OpenAI actively coached departing employees on how to avoid the dreaded walk out, the immediate removal from the premises upon resignation, so they could maintain access to Apple's networks for a standard two-week notice period.

Business Implications and Partnerships

The legal battle arrives as OpenAI weighs plans to become a publicly traded company through an initial public offering. Apple suggests that the company's hardware business is rotten to its core due to its reliance on stolen secrets.

The tension is compounded by the 2025 merger of OpenAI with io Products, a startup co-founded by former Apple Chief Design Officer Jony Ive, Tang Tan, and Evans Hankey. OpenAI acquired the startup for $6.5 billion. While Jony Ive is mentioned in the suit, he is not a defendant.

The two companies have previously maintained a close strategic partnership, announced two years ago, which integrated ChatGPT into Siri and Apple's Image Playground app. However, this relationship has soured. Apple recently broadened its AI partnerships by using Google's Gemini models for Siri and Apple Intelligence updates. Meanwhile, reports suggest OpenAI may consider legal action against Apple, alleging that ChatGPT was not integrated deeply enough into Apple's ecosystem.

Company Responses

Apple says it attempted to resolve the matter out of court in February after voicing concerns to OpenAI about improper access to confidential information. Apple claims OpenAI never responded to those inquiries.

Apple is now seeking a jury trial, demanding that OpenAI destroy all proprietary materials and redesign any upcoming products that incorporate Apple's technology.

"We have no interest in other companies' trade secrets,"

OpenAI spokesperson, via CNET

OpenAI continues to face various legal challenges, including lawsuits from publishers regarding copyright infringement used to train its models and a suit from a mother claiming a chatbot interaction led to her daughter's death.