Apple sues OpenAI over alleged trade secret theft

Washington DC, United States Jul 11, 2026 ALN: Apple filed a lawsuit Friday against OpenAI over allegations of trade secret theft and breach of contract.

The iPhone maker alleges that this misconduct, which it says reveals a pattern of theft from OpenAI employees who previously worked at Apple, was directed by OpenAI’s senior leadership, including Chief Hardware Officer Tang Tan.

The lawsuit, which was filed in the U.S. District Court for the Northern District of California, accuses Tan of using Apple’s confidential project code names during OpenAI’s recruiting process, asking job candidates to bring in Apple hardware components to their interviews, coaching departing Apple employees on how to evade the company’s security procedures, and asking for details about the company’s unannounced products.

Before joining OpenAI, Tan had spent 24 years at Apple, most recently as VP of product design for the iPhone and Apple Watch. His extensive experience at Apple, a company known for its stringent protection of intellectual property, raises questions about the ethical implications of his actions after leaving the company.

The accusations come at a time when OpenAI is rumored to be developing its first hardware product, which would likely compete with the iPhone. In April, industry analyst Ming-Chi Kuo suggested this device could be a smartphone that would rely on AI agents instead of apps. If true, it would be one of the largest threats to Apple’s core hardware business to date, potentially altering the competitive landscape in the tech industry.

Apple’s former lead designer Jony Ive’s device startup io was acquired by OpenAI last year in a $6.5 billion deal to aid the AI company with its hardware ambitions. While io was named in the filing, Ive was not. This acquisition highlights the growing intersection between artificial intelligence and hardware design, a field that has traditionally been dominated by established tech giants like Apple.

Tan is not the only OpenAI employee referenced in the new complaint. Apple also alleges that Chang Liu, who spent eight years at Apple as a senior systems electrical engineer, failed to return an Apple-issued laptop after leaving the company for OpenAI in 2026 and had used the computer to download confidential Apple technical documents. This aspect of the case underscores the importance of safeguarding proprietary information, especially in an industry where innovation is closely tied to unique technologies and designs.

Apple says in the complaint that the stolen documents included information about unannounced technologies, features, and products, including technical specifications, engineering presentations, and proprietary project data. The implications of such a breach could be significant, not only for Apple but also for OpenAI, as it could lead to legal repercussions and damage to reputations.

Liu is also accused in the lawsuit of sharing Apple’s confidential information with other Apple employees applying for jobs at OpenAI, advising at least one of them on what to study before their interview. This raises ethical questions about the responsibilities of employees transitioning between companies, particularly in high-stakes sectors like technology where trade secrets can have a profound impact on business success.

Apple sent a letter to OpenAI in February to raise its concerns and received no response, the company said in the complaint. This lack of communication could be interpreted as a disregard for the seriousness of the allegations, further complicating the relationship between the two companies.

It alleges that the behavior of these former employees is part of OpenAI’s strategy to extract Apple’s confidential information, which included asking Apple employees to bring designs and prototypes to their interviews, and answer questions about things like component and vendor selection processes. If proven, this could indicate a systemic issue within OpenAI regarding the handling of sensitive information and the ethical considerations surrounding recruitment practices.

Apple says its ongoing investigation revealed that OpenAI and its partners have even used Apple’s confidential information while the AI model maker develops its own hardware product. For instance, the filing references a proprietary metal finishing technique that OpenAI used after it allegedly misled a partner into believing it had Apple’s permission to do so. This could have far-reaching consequences, especially if OpenAI’s new product is perceived as infringing on Apple’s intellectual property.

Like many tech companies, Apple typically investigates potential trade secret theft or other improper activity by analyzing communications that took place on company-owned devices and reading through its server logs. By taking the case to court, Apple will have an opportunity to learn more about the extent of the alleged operation through the legal discovery process, which could reveal additional information about OpenAI’s practices and the involvement of other employees.

Apple is asking the court to bar OpenAI from using or disclosing its trade secrets, require the company to return any confidential Apple materials, and preserve evidence related to the case. This legal action is a significant step, as it reflects Apple’s commitment to protecting its intellectual property and maintaining its competitive edge in the technology market.

“This is the tip of the iceberg. Apple lacks visibility into what’s been happening behind closed doors at OpenAI, where such misconduct is normalized and exemplified by leadership,” the filing states. “As a natural result, OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets.” This statement highlights Apple’s concerns regarding the integrity of OpenAI’s business practices and the potential long-term implications for both companies.

In a prepared statement, Apple also said the following:

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. Recently, significant evidence has emerged suggesting individuals employed by OpenAI wrongfully took Apple’s secret and confidential information regarding our unreleased technologies, processes, and products. We will always defend our teams’ hard work and innovations, and we are taking all appropriate steps to do so.

OpenAI was asked for comment. The company responded after publication, pointing to its public statement shared on X, which reads: “We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.” This response suggests that OpenAI intends to defend itself vigorously against the allegations, emphasizing its commitment to innovation rather than engaging in unethical practices.

This story is developing and will be updated. It was originally published at 1:32 p.m. PT.