Apple Sues OpenAI Over Alleged Trade Secret Theft by Former Employees

Quick Facts

• Apple filed suit in the Northern District of California accusing OpenAI, its Chief Hardware Officer, and a former senior engineer of trade secret misappropriation and breach of contract.
• OpenAI spent $6.4 billion to acquire io Products, the hardware company co-founded by Tang Tan, Apple’s former VP of product design who spent 24 years at Apple.
• Apple alleges more than 400 former Apple employees now work at OpenAI, and that it sent a letter in February raising concerns that received no response.

Apple filed a federal lawsuit against OpenAI on July 10, accusing the artificial intelligence company of systematically stealing confidential hardware designs, manufacturing techniques, and unreleased product data. The suit, filed in the U.S. District Court for the Northern District of California, names OpenAI, io Products, Chief Hardware Officer Tang Tan, and former senior engineer Chang Liu as defendants.

The filing marks a sharp turn in the relationship between Apple and OpenAI, which entered a high-profile partnership in 2024 when ChatGPT was integrated into Apple’s operating system.

The Allegations Against Tang Tan

Tan spent 24 years at Apple, most recently as VP of product design for the iPhone and Apple Watch, before leaving to co-found io Products. Apple accuses him of using confidential project code names during OpenAI’s recruiting process and coaching departing Apple employees on how to evade exit security checks.

According to the complaint, Tan directed job candidates to bring unreleased Apple hardware components to interviews, including batteries, shields, housings, and back glass components in multiple colors. He also allegedly circulated an internal Apple offboarding document instructing new hires on how to avoid scrutiny when leaving Apple, including advising them not to tell Apple they were headed to OpenAI.

The Allegations Against Chang Liu

Liu worked at Apple for eight years as a senior systems electrical engineer before joining OpenAI in January 2026. Apple alleges he failed to return a company-issued laptop and used it to download dozens of confidential files from Apple’s network, many explicitly labeled as confidential.

The complaint states Liu exploited an authentication bug to access Apple’s shared network folders and downloaded a compilation of technical files totaling more than a thousand pages. Apple alleges Liu told a current Apple colleague, Yu-Ting Peng, about his plans to access the files, and described the security flaw as “so funny.” Liu is also accused of sharing Apple’s confidential information with other Apple employees who were applying for jobs at OpenAI.

Proprietary Techniques and Hardware

Apple’s complaint references a proprietary metal finishing technique that it alleges OpenAI used after misleading a manufacturing partner into believing it had Apple’s permission to do so. Apple says its investigation found that confidential information was used while OpenAI developed its own consumer hardware product.

“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 wrote in the filing.

OpenAI spent $6.4 billion to acquire io Products, which was also co-founded with the involvement of Jony Ive, Apple’s former chief design officer. The suit does not name Ive as a defendant or accuse him of wrongdoing.

What Apple Is Asking For

Apple is seeking damages, injunctions, and a court order barring OpenAI from using or disclosing its trade secrets. The company also wants OpenAI to return all confidential materials, destroy proprietary data, redesign unreleased products, and preserve evidence. Apple is requesting a jury trial.

OpenAI responded in a brief statement: “We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.”

Apple noted in the complaint that it sent a letter to OpenAI in February raising concerns about the alleged misconduct and received no response. The company says its investigation is ongoing and described the known misconduct as “the tip of the iceberg.”

Read more: Apple sues OpenAI, former employees over alleged intellectual property theft