Apple sues OpenAI and two former employees over trade secret theft

Apple initiated legal action on Friday, 10 July 2026, against OpenAI, alleging a systematic campaign of trade secret theft designed to accelerate the artificial intelligence firm’s push into consumer hardware. The lawsuit, filed in the U.S. District Court for the Northern District of California, marks a definitive end to the collaborative era between the two tech giants, as Apple claims the foundation of OpenAI’s hardware ambitions is built upon misappropriated internal data.

The complaint centers on allegations that OpenAI recruited former Apple staff to extract confidential information regarding unreleased products, manufacturing processes, and supply chain relationships. Apple claims this activity reflects a coordinated pattern of misconduct at an institutional level rather than isolated incidents. The lawsuit names two former Apple employees as defendants: Tang Yew Tan, now OpenAI’s chief hardware officer, and Chang Liu, a technical staffer.

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Allegations of Systematic Misappropriation

Apple’s court filing details several methods allegedly used to compromise its intellectual property. According to the Boston Herald, Apple alleges that Tan—who spent over two decades at Apple designing the iPhone and Apple Watch—used internal project codenames to solicit information from job candidates who were still employed by the iPhone maker. Apple further claims Tan directed these recruits to bring physical components from the office to interviews for show and tell sessions.

The allegations against Liu are equally specific. Apple asserts that Liu, after joining OpenAI, failed to return an Apple-issued laptop and subsequently exploited an authentication bug to access and download internal network files. The company claims these files included detailed manufacturing specifications and engineering presentations for unreleased hardware.

Beyond these individuals, the suit targets io Products, the hardware startup founded by former Apple design leader Jony Ive, which OpenAI acquired last year. Apple contends that OpenAI and its partners misled at least one trusted supplier into performing a specialized metal-finishing technique under the false pretense that the work had Apple’s authorization.

"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, via Court Filing

A Deteriorating Partnership

The legal move arrives after a period of cooling relations. The two companies previously signed a deal in 2024 to integrate ChatGPT into Apple’s operating systems. However, the partnership recently soured; Apple has since pivoted to Google's Gemini to power its latest voice assistant updates, and reports suggest OpenAI had previously considered legal action against Apple over integration disagreements.

OpenAI has maintained its innocence regarding the specific claims of theft. We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere, said spokesperson Drew Pusateri in a statement. The AI firm, which faces competition from others as it contemplates an IPO, has not confirmed the exact nature of its upcoming hardware, though it has described an effort to move beyond traditional products and interfaces.

What to Watch Next

The case is expected to unfold through a lengthy discovery process, which may provide insight into the following developments:

• Legal Discovery: Apple intends to use the court process to gain visibility into internal operations at OpenAI, which it characterizes as the tip of the iceberg.
• Talent Competition: With over 400 former Apple employees currently at OpenAI, industry experts note that while poaching is common, the misuse of proprietary documents remains a strictly litigated issue.

Apple stated in its filing that it attempted to address these concerns directly with OpenAI in February but received no response. As the litigation proceeds, the tech industry will be watching to see if these allegations force OpenAI to alter the trajectory of its hardware division or if they will serve to complicate the company’s broader business objectives on the road to a potential IPO.