Apple has filed a major lawsuit against OpenAI, accusing the AI company of stealing trade secrets as it develops its own hardware devices. The lawsuit, filed in federal court in California on Friday, alleges that OpenAI encouraged Apple employees to share confidential information and guided them on how to avoid detection when switching companies.

What Exactly Is Apple Accusing OpenAI Of?

Apple's legal filing centers on two former employees now working at OpenAI. The first is Tang Tan, OpenAI's chief hardware officer, who previously helped design the iPhone, Apple Watch, and iPod. The second is Chang Liu, a former Apple electrical engineer whom Apple says it trusted with sensitive product development work before he joined OpenAI earlier this year.

According to Apple's lawsuit, these individuals accessed and downloaded confidential hardware-related files on Apple-issued devices after leaving the company. The filing also alleges that Tan directed job candidates still employed at Apple to bring "Actual parts" from Apple to their OpenAI interviews.

Apple stated in its legal filing: "This case is about Apple's former employees stealing Apple's trade secrets for the benefit of OpenAI." The company claims it contacted OpenAI in February about its concerns, but the AI company did not respond.

Apple

Why Does OpenAI Want to Build Hardware?

OpenAI has been working on a secret hardware project as part of a broader effort to create physical devices that interact with AI in new ways. The company has not publicly detailed exactly what device it is building, but has described it as an attempt to move beyond "traditional products and interfaces".

As part of this expansion, OpenAI recruited renowned designer Jony Ive to oversee the hardware initiative. Last year, OpenAI acquired io Products, a company co-founded by Ive and Tan, in a deal valued at nearly $6.5 billion. OpenAI's chief financial officer Sarah Friar told the Associated Press in April that the company plans to release consumer hardware "towards the end of this year".

How to Understand the Broader Context of This Dispute

• Partnership History: Apple and OpenAI partnered in 2024 to integrate ChatGPT as an AI-powered "answer engine" on iPhones when Siri could not satisfy user needs, but the relationship has shifted toward rivalry.
• Competitive Pressure: Apple sought OpenAI's help years ago because it was behind in the AI race sparked by ChatGPT's arrival, but now views OpenAI's hardware ambitions as a direct threat to its own products.
• Legal Momentum: Apple's lawsuit comes as OpenAI explores going public and faces heightened competition from rivals including Anthropic and Google, adding pressure to the company's leadership.

The lawsuit represents a dramatic reversal in the relationship between two of Silicon Valley's most influential companies. Apple said it will "always defend our teams' hard work and innovations, and we are taking all appropriate steps to do so".

Apple

OpenAI responded through a spokesperson, stating that the company is "still reviewing the filing" but has "no interest in other companies' trade secrets." The company emphasized that it remains "focused on building innovative technology that empowers people everywhere".

The lawsuit also names io Products as a defendant. Lawyers who previously represented the firm and Tan referred inquiries to OpenAI for comment. This legal action adds another layer of complexity to OpenAI's hardware ambitions, which already face a trademark infringement lawsuit from a little-known startup called iyO Inc.

The case highlights the intense competition in the AI hardware space and the lengths companies are willing to go to protect their intellectual property. As OpenAI continues to pursue its vision of AI-powered devices, it now faces not only technical challenges but also significant legal obstacles that could delay or reshape its hardware strategy.