Apple filed the so-called on Friday in a lawsuit against OpenAI and its hardware chief for allegedly stealing the iPhone maker’s trade secrets, including unpublished parts and prototypes, confidential designs and stealth design documents.
The lawsuit accuses OpenAI chief hardware officer Tang Tan, who spent 24 years at Apple and oversaw iPhone product design, and his colleagues at the AI company of encouraging people leaving or considering leaving Apple to bring proprietary and unpublished technology with them. Tan allegedly helped train recruits to circumvent Apple’s data security protocols and directed them to bring confidential Apple parts to interviews at OpenAI.
“OpenAI’s nascent hardware business currently rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets,” Apple claims in a lawsuit filed in U.S. District Court in San Jose. The company describes OpenAI as resorting to “cutting illegal shortcuts” under “increasing pressure to deliver its first commercial hardware product.”
OpenAI and Tan did not immediately respond to requests for comment.
Apple spokeswoman Hannah Smith says the company “will always defend the hard work and innovation of our teams, and we take every appropriate step to do so.”
The lawsuit sets up a high-stakes fight and the most dramatic fight over intellectual property theft in Silicon Valley since autonomous ride-hailing company Waymo in 2017 accused Uber of stealing hardware designs after it approached a former Waymo engineer who left with thousands of confidential files. Uber agreed to pay $245 million to settle the lawsuit at trial next year.
Apple and OpenAI have been partners since 2024, when the companies announced the breakthrough solution agreement to distribute ChatGPT on iPhones, Macbooks and iPads. But the relationship has deteriorated in recent years, prompting Apple to rely more on Google’s Gemini AI technology as the basis for the company’s internal artificial intelligence models. OpenAI and Apple are expected to compete more fiercely in the emerging market for AI-powered consumer devices in the coming years.
The lawsuit says OpenAI hired more than 400 former Apple employees. This includes several former Apple veterans who lead the development of AI-powered consumer devices at OpenAI. Last year, OpenAI paid $6.5 billion to acquire a startup called io Products, which was co-founded by longtime Apple executives including Tan, Scott Cannon, Evans Hankey and famed designer Jony Ive.
io Products and Chang Liu, an electrical engineer at OpenAI who worked at Apple until January, were also named as defendants in the lawsuit. (Liu did not immediately respond to a request for comment.)
Apple’s investigation into the alleged theft is based on data and messages collected from employee devices. The lawsuit says the company noticed the alleged theft earlier this year after Liu never returned his laptop and wrote to a former colleague that he still had access to Apple’s internal file-sharing system. (Apple says in its filing that Liu’s access was enabled by a bug that has since been fixed.)
The lawsuit said Liu “downloaded dozens of confidential Apple files related to hardware,” including a presentation on the production and testing of complicated circuit boards used in Apple hardware. He adds that Liu also trained an Apple employee he was recruiting to OpenAI on how to “avoid problems with the security team” when copying confidential Apple files.”
In February, Apple wrote to OpenAI expressing initial concerns about the alleged theft, but received no response. This led to further investigation and the filing of a lawsuit.
Apple learned that Tan had emailed himself information about the company’s suppliers before he left. Apple says other employees leaving for OpenAI did the same. Additionally, Tan “directed job candidates who continue to work for Apple to bring ‘real Apple parts’ to job interviews in ‘show-and-tell’ sessions, where he and his team at OpenAI can obtain even more confidential Apple information,” the lawsuit alleges, listing batteries, logic boards and shields as sought-after components.