Apple Sues OpenAI, Claims Former Employees Stole Trade Secrets

In brief

Apple sued OpenAI and two former employees, alleging theft of hardware trade secrets.
The complaint claims former Apple employees accessed confidential files, shared supplier information, and used internal information at OpenAI.
The lawsuit follows OpenAI’s $6.5 billion acquisition of Jony Ive’s hardware startup io Products.

Apple has sued OpenAI and two former employees, accusing the ChatGPT maker of using stolen trade secrets for its consumer hardware efforts.

The complaint, filed Friday in the U.S. District Court for the Northern District of California, names former Apple senior system electrical engineer Chang Liu and former iPhone and Apple Watch design executive Tang Yew Tan, along with OpenAI Foundation, OpenAI Group PBC, and io Products.

Apple alleges Liu, who left the company in January after eight years, failed to return a company laptop and later accessed Apple’s internal systems through an authentication bug.

“While employed by OpenAI, Mr. Liu also exploited a rare, previously unknown authentication bug to access Apple’s shared network folders,” Apple’s attorneys said in the complaint. “Upon discovering that he had this unauthorized access to Apple’s systems, Mr. Liu did not report it, return his stolen Apple-issued work laptop, or delete the program that allowed the access.”

Apple alleges Liu downloaded dozens of confidential hardware files, including information about unreleased products, engineering presentations, technical specifications, and proprietary project data.

The company also alleges Tan, who spent 24 years at Apple before becoming OpenAI’s chief hardware officer, used confidential information from his time at Apple to benefit OpenAI.

The complaint claims Tan used Apple’s internal project names during OpenAI interviews and asked about unreleased products. Apple also alleges candidates were told to bring “actual parts,” for “show and tell.”

Apple further claims OpenAI’s recruiting process requested “CAD/design artifacts,” prototypes, supplier information, and details about employees’ work on Apple hardware.

Apple and OpenAI did not immediately respond to a request for comment by Decrypt.

The lawsuit follows OpenAI’s $6.4 billion acquisition of io Products, the hardware startup founded by former Apple designer Jony Ive. Ive is not named in the complaint.

According to the filing, OpenAI’s hardware division has hired more than 400 former Apple employees. Apple claims it contacted OpenAI in February with concerns about confidential information entering the company but did not receive a response.

The news comes after a separate trade secret dispute between OpenAI and Elon Musk’s xAI. In September, xAI sued OpenAI, alleging the ChatGPT maker recruited former employees to obtain confidential source code, training methods, and data center strategies.

OpenAI denied the allegations, and a federal judge dismissed the lawsuit in June, finding xAI failed to show OpenAI encouraged a former employee to disclose confidential information.

The lawsuit is a stark pivot from Apple and OpenAI’s earlier relationship.

In 2024, Apple tapped OpenAI to bring ChatGPT to Siri as part of its Apple Intelligence initiative. However, earlier this year, Apple turned to Google’s Gemini to power its next generation of AI models after delays stalled the rollout.