Apple sues OpenAI, ex-hardware chief for stealing trade secrets on prototypes and designs

Apple has filed a high-stakes lawsuit against OpenAI and its hardware chief, Tang Tan, accusing them of orchestrating a systematic theft of trade secrets. Tan, who spent 24 years at Apple overseeing iPhone product design, allegedly coached departing and prospective Apple employees on how to evade security protocols and bring confidential parts—like batteries, logic boards, and shields—to job interviews at OpenAI. The lawsuit, filed in US district court in San Jose, claims that OpenAI's hardware business is built on misappropriated technology, calling it "rotten to its core." Apple says the scheme involves more than 400 former Apple employees now at OpenAI, including key leaders from its acquisition of io Products for $6.5 billion.

The company says its investigation began after a former Apple employee, electrical engineer Chang Liu, never returned his company laptop and downloaded dozens of confidential hardware files. Liu allegedly coached another recruit on how to "avoid trouble with the security team" when copying files. Apple raised concerns with OpenAI in February but received no response. The lawsuit opens a dramatic IP battle reminiscent of the 2017 Waymo v. Uber case, which settled for $245 million. Apple and OpenAI were partners since 2024 for ChatGPT integration on Apple devices, but the relationship has frayed as Apple increasingly relies on Google's Gemini. The case signals a coming fierce competition in AI-powered consumer devices.