Apple sues OpenAI and two ex-employees over alleged theft of trade secrets for AI hardware

The lawsuit

Apple filed a federal lawsuit in California on Friday, 10 July 2026, accusing OpenAI, its subsidiary io Products and two former Apple employees of a coordinated scheme to steal trade secrets. The complaint describes an alleged "pattern of theft" that the iPhone maker says helped OpenAI develop a still-unnamed hardware device designed around artificial intelligence. More than 400 former Apple employees now work at OpenAI, the filing notes, and Apple argues that the company systematically exploited that hiring to obtain confidential product designs, manufacturing processes and supply-chain information.

This case is about the theft of Apple’s trade secrets by former employees of the company for the benefit of OpenAI. Apple brings this lawsuit to put an end to this situation.

The former employees

Two ex-Apple staff are named as defendants alongside OpenAI. Tang Yew Tan spent more than 20 years at Apple, rising to vice-president of product design for the iPhone and Apple Watch. He left in 2024 and co-founded io, the hardware venture of legendary designer Jony Ive, which OpenAI acquired in 2025 for around $6.5 billion. Tan now serves as OpenAI’s head of hardware. The second defendant, Chang Liu, was a senior system electrical engineer entrusted with sensitive product-development projects. He joined OpenAI in January 2026 after eight years at Apple.

Recruitment as a pipeline

Apple alleges that Tan systematically tried to funnel proprietary knowledge into OpenAI. Before his departure he emailed himself internal supplier lists and industry summaries, according to the complaint. More strikingly, he is accused of encouraging Apple employees to bring physical components (batteries, device enclosures in different colours) to job interviews at OpenAI for "show and tell" sessions. Apple characterises this as part of a deliberate strategy by OpenAI to shortcut its hardware work, which the complaint says proved harder than the company expected.

The digital break-in

The allegations against Liu read like corporate espionage. When he left Apple he did not return a company-issued laptop, and weeks later he discovered an authentication flaw that still let him access Apple’s internal network. Instead of reporting it, he sent a message to a former colleague celebrating the discovery and then spent weeks downloading dozens of confidential files, including a technical compilation of more than a thousand pages detailing manufacturing specifications for Apple product motherboards. The filing says he also advised that colleague, whom he was trying to recruit to OpenAI, on how to copy files without triggering the security team and which proprietary material to study before her interview, and urged her to use an alternative messaging app to avoid detection.

A strained partnership

Apple and OpenAI have been partners for several years: iPhone users can hand off Siri queries to ChatGPT. Yet the relationship has frayed. Media reports note that OpenAI itself considered suing Apple months ago for breach of contract, claiming the partnership had underperformed. OpenAI spokesman Drew Pusateri told the BBC the company has no interest in others’ secrets, but the lawsuit’s language is blistering: Apple says OpenAI’s hardware business is "rotten to the core by its illegal reliance on stolen trade secrets."

We have no interest in other companies' trade secrets.