‘Rotten to its core’: Apple’s lawsuit accuses OpenAI of stealing trade secrets

‘At every level, from members of its technical staff to its chief hardware officer, and in coordination with business partners, OpenAI has been stealing Apple’s trade secrets and confidential information,’ Apple said in a lawsuit filed Friday, July 10, in the Northern District of California — reportedly the first time in the company’s 50-year history it has sued a close partner.

The suit names OpenAI’s chief hardware officer, Tang Tan, a former Apple vice president of product design who led iPhone, smartwatch and AirPods hardware development before leaving in 2024 to co-found io Products Inc, a startup OpenAI later acquired for $6.5 billion. Apple alleges Tan encouraged job candidates to disclose information about unreleased products during interviews.

Also named is Chang Liu, a former iPhone hardware engineer who joined OpenAI in January. According to the filing, Liu ‘surreptitiously accessed and downloaded dozens’ of confidential Apple files over several weeks, including technical specifications and proprietary project data for unreleased products.

Apple says more than 400 of its former employees now work at OpenAI and describes its findings so far as ‘the tip of the iceberg,’ saying it has limited visibility into what has happened behind OpenAI’s closed doors. The company added that OpenAI’s ‘nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets.’

Apple is seeking a jury trial and wants OpenAI to cease the alleged practices, destroy any proprietary materials, and redesign upcoming products so they contain none of its technology. The company said it attempted to resolve the dispute out of court months earlier but did not receive a response before filing suit.