Apple Sues OpenAI Over Alleged Theft of Hardware Trade Secrets

Apple filed a lawsuit against OpenAI on Friday, July 10, in the U.S. District Court for the Northern District of California, accusing the AI company, its hardware subsidiary io Products, and two named former Apple employees of a coordinated campaign to steal Apple’s confidential hardware trade secrets. The complaint describes what Apple calls a pattern of theft that reaches, in the filing’s words, “at every level, from members of its Technical Staff to its Chief Hardware Officer, and in coordination with business partners.”

The lawsuit lands as OpenAI works to ship its first consumer hardware device, a project built around the 2025 acquisition of io, the startup founded by former Apple design chief Jony Ive. Analyst Ming-Chi Kuo has suggested the device could be a smartphone that leans on AI agents instead of a conventional app interface. Apple’s complaint argues the project now “rests on the shakiest of foundations,” built in part on information the company says never should have left its buildings.

Who Apple is suing

The complaint names OpenAI and io Products as corporate defendants, along with two individuals: Tang Tan and Chang Liu. Ive himself, along with io co-founders Evans Hankey and Scott Cannon, both also former Apple employees, are not personally named as defendants in this filing.

Tan spent 24 years at Apple, most recently as vice president of product design for the iPhone and Apple Watch, before leaving in February 2024 to join Ive’s io. He is now OpenAI’s chief hardware officer. Liu worked at Apple for eight years as a senior systems electrical engineer before departing for OpenAI in January 2026.

OpenAI acquired io in a $6.5 billion deal in 2025, a takeover that brought more than 50 engineers, developers, and other employees into OpenAI. The unit sits at the center of OpenAI’s push into consumer hardware.

What Apple says happened in job interviews

Apple’s complaint focuses heavily on OpenAI’s hiring process for its hardware team. It alleges Tan used insider knowledge of Apple’s unreleased projects to press candidates for more information during interviews, at one point invoking an internal Apple project code name to ask a candidate directly what the plan was for an unannounced product.

The filing also alleges Tan directed job candidates who still worked at Apple to bring “actual parts,” meaning real Apple hardware components and samples, to their OpenAI interviews for what the complaint calls “show and tell” sessions. Apple says at least one candidate was startled by the request, telling Tan’s team he “didn’t even know we could take those from the office.” According to the complaint, OpenAI’s interviewers also asked candidates to bring CAD and design files and prototypes, and to describe Apple’s component and vendor selection process along with the specific software the company uses for system integration and simulation.

Apple alleges this became a repeated pattern rather than an isolated incident, and that Tan separately possessed and shared an internal Apple document outlining the company’s security protocols for departing employees, distributing it to new OpenAI hires before they had even given notice at Apple.

The laptop Apple says never came back

The complaint’s allegations against Liu center on hardware rather than interviews. Apple says Liu failed to return his Apple-issued laptop after leaving the company in early 2026 and instead used it to download confidential technical documents covering unreleased products, technical specifications, engineering presentations, and proprietary project data.

Apple also alleges Liu coached at least one other Apple employee who was interviewing at OpenAI, advising the colleague on what to study before the interview and how to copy confidential files while evading Apple’s departure security checks. The complaint states Liu suggested the two communicate over the Line messaging app specifically to avoid detection. Apple says its internal investigation turned up a broader pattern among employees who left for OpenAI of taking deliberate steps to sidestep the security procedures meant to protect its confidential information.

Apple’s warning and OpenAI’s response

According to the complaint, Apple raised its concerns directly with OpenAI in a letter sent in February 2026 and received no response. Apple’s filing goes further than the interview and laptop allegations, claiming OpenAI also reached its hardware partners directly: the complaint references a proprietary Apple metal finishing technique that OpenAI allegedly used after leading a shared manufacturing partner to believe it had Apple’s permission to do so.

“This is the tip of the iceberg,” the complaint states. “Apple lacks visibility into what’s been happening behind closed doors at OpenAI, where such misconduct is normalized and exemplified by leadership.”

An Apple spokesperson said in a statement: “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 spokesperson Drew Pusateri disputed the substance of the claims: “We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.”

Apple is asking the court to bar OpenAI from using or disclosing the disputed trade secrets, to order the return of any confidential Apple material still in OpenAI’s possession, and to require that evidence related to the case be preserved while the suit proceeds.

Why it matters

Filing suit, rather than handling the dispute privately, gives Apple access to formal legal discovery: a way to compel documents and testimony about OpenAI’s hardware program that Apple says it cannot otherwise see. That matters beyond the two named employees. OpenAI’s device, still unannounced, is widely expected to be the company’s most direct move yet into hardware that could compete with the iPhone, and the lawsuit puts the origins of that program under court scrutiny before it ever ships. For an AI industry that has spent the last few years hiring aggressively across competitors, the case also tests where ordinary competitive hiring ends and misappropriation of trade secrets begins, a line every AI hardware effort recruiting from established device makers will now be watching.

Sources and image credit

• The Verge: Apple sues OpenAI for allegedly stealing hardware secrets
• TechCrunch: Apple sues OpenAI over alleged trade secret theft
• 9to5Mac: Apple sues OpenAI, accuses ex-employees of stealing trade secrets
• Featured image: Apple Park aerial view, June 2024 by Nils Huenerfuerst, CC0, via Wikimedia Commons.