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Apple vs. OpenAI: Inside the Trade Secret Battle Over a Former iPhone Engineer

Apple has escalated its legal battle against OpenAI, claiming the AI company is actively destroying evidence and that a former iPhone engineer downloaded confidential Apple circuit schematics and used them in his work at OpenAI. The dispute centers on Chang Liu, who left Apple for OpenAI in January and is one of more than 400 former Apple employees now working at the ChatGPT maker.

What Evidence Is at the Heart of This Dispute?

Apple filed a court brief on August 31 in support of its motion for expedited pre-trial fact-finding, claiming that OpenAI has been dragging its feet on producing evidence. According to Apple's lawyers, the key piece of evidence came only recently: an Apple-issued MacBook that Liu had been using since leaving the company.

An initial forensic analysis of the laptop revealed troubling findings. Apple's filing states that "Mr Liu and others at OpenAI were well aware" of his continued unauthorized access to Apple's third-party cloud storage providers. Even more damaging, the laptop contains evidence that Liu "sent instructions for destroying evidence to an OpenAI colleague who confirmed she would comply," according to Apple's legal team.

Apple also claims that Liu "used a tool in his work at OpenAI that has the same name as an internal Apple engineering application used for Apple development work." The company is seeking monetary damages and an order requiring OpenAI to halt the alleged conduct and destroy any proprietary materials.

How Is OpenAI Defending Itself?

OpenAI has pushed to have the case dismissed entirely, characterizing the dispute as "a mess of Apple's own making" in its own court filing on August 31. The company maintains that it adhered to industry-wide recruiting standards when interviewing candidates from Apple and insists that Liu was simply trying to help a former colleague at Apple when accessing the cloud data.

OpenAI's defense strategy centers on several key arguments. The company argues that any Apple documents accessed by Liu "are irrelevant" to his work at OpenAI and that he opened them "on behalf of Apple employees, for Apple work purposes." OpenAI also criticized Apple's "sloppy procedures" around data security and employee exit management, saying they directly contributed to the situation.

In its filing, OpenAI urged the court to "significantly narrow" Apple's request for an injunction if one is granted at all, warning that the measure could "chill employee mobility." The company emphasized that employees have the right to leave and seek new opportunities, stating: "Employees have choices. They can leave a company like Apple that has struggled to adopt AI and move to an exciting startup that builds innovative products. Apple may not like those choices. But it cannot claim those choices are unlawful".

What Are the Key Claims in This Legal Battle?

  • Trade Secret Allegations: Apple originally accused OpenAI of encouraging Apple employees to share information, components, drawings, and other materials related to unreleased products while taking steps to cover its tracks.
  • Evidence Destruction: Apple claims OpenAI is actively destroying crucial evidence, including allegations that Liu sent instructions for destroying evidence to an OpenAI colleague.
  • Unauthorized Access: Apple alleges that Liu maintained unauthorized access to Apple's cloud storage providers even after leaving the company, with OpenAI colleagues being aware of this access.
  • Hardware Development Context: The dispute has intensified as OpenAI enlisted former Apple design guru Jony Ive to help develop upcoming hardware products, including a doughnut-shaped smart speaker.

What Happens Next in the Case?

A federal judge is scheduled to hear arguments on Apple's motion for a preliminary injunction on October 1. This hearing will be critical in determining whether OpenAI must immediately stop using alleged stolen trade secrets while the case proceeds.

The once-cordial working relationship between Apple and OpenAI has deteriorated significantly over 2025. The relationship frayed particularly after OpenAI enlisted Jony Ive, Apple's former design chief, to help develop upcoming hardware products. According to reports, the first device from that collaboration will be a doughnut-shaped smart speaker, roughly the size of a hockey puck, that includes moving parts to lend the gadget personality.

Apple's aggressive legal posture reflects the company's concern that OpenAI may be leveraging insider knowledge from former Apple employees to accelerate its hardware ambitions. The case raises broader questions about employee mobility, trade secret protection, and the responsibilities of companies hiring talent from competitors in the fast-moving AI industry.