Apple sues OpenAI over alleged theft of trade secrets — claims company mentored incoming employees on bringing confidential information

(Image credit: Getty Images)

Apple filed a federal lawsuit against OpenAI on Friday, accusing the AI company and its chief hardware officer of stealing its trade secrets.

"OpenAI and its cohorts, led at least in part by former Apple employees, have recruited candidates from Apple, extracted their knowledge of Apple’s sensitive and confidential information, and then continued to exploit that knowledge once they arrived," the complaint reads. "As a result, OpenAI has misappropriated Apple’s trade secrets and confidential information in a variety of ways."

The suit, filed in the Northern District of California, names OpenAI technical staff member Chang Liu, chief hardware officer Tang Tan, OpenAI, and io Products as defendants. The last of that group is notable because it was founded by Tan in collaboration with former Apple design head Jony Ive, Evans Hankey (Ive's successor at Apple), and former Apple designer Scott Cannon. Notably, the complaint seems to attempt to avoid naming the founders, though Ive's name is cited in a URL.

Tan previously served as a vice president of product design at Apple, working on the iPhone, AirPods, and Apple Watch. Liu served at Apple as a senior electrical engineer.

In the complaint, Apple alleges that it reached out to OpenAI in February with concerns, but that OpenAI did not respond. Apple claims that Tan attempted to gain secrets from Apple employees, including asking prospective job candidates to bring components for "show and tell" sessions and used his knowledge of the company to squeeze more information out of candidates. The suit claims that Liu never returned a company laptop, and used an authentication bug to access Apple files.

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Apple also claims that OpenAI told incoming employees how to leave their former job, suggesting they stay as long as possible and not disclose their former employer in order to continue to access confidential information.

"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," the suit reads. "As a natural result, OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets."

OpenAI did not immediately respond to a request for comment from Tom's Hardware. Apple's lawsuit claims that over 400 former Apple employees currently work at OpenAI.

Apple is rumored to be working on a number of AI-powered hardware projects, including AirPods with cameras, a pendant, and home robots. It's less clear what hardware OpenAI may be working on, though The Information suggested the company has a HomePod-style smart speaker in the works.

Apple is requesting a jury trial, damages, attorney fees, and orders that the OpenAI may not use Apple's trade secrets, among other injunctions.

In May, Bloomberg reported that OpenAI was considering legal action against Apple because it expected deeper integration and more users from ChatGPT features built into iOS.

If the trial does go to court, it's sure to be a dramatic one, potentially dragging several former high-level Apple employees into testimony through discovery and testimony.The trial, Apple Inc. v. Liu et al, is case 5:26-cv-07078 in the United States District Court in Southern California.

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Andrew E. Freedman is a senior editor at Tom's Hardware focusing on laptops, desktops and gaming. He also keeps up with the latest news. A lover of all things gaming and tech, his previous work has shown up in Tom's Guide, Laptop Mag, Kotaku, PCMag and Complex, among others. Follow him on Threads @FreedmanAE and BlueSky @andrewfreedman.net. You can send him tips on Signal: andrewfreedman.01

11 Comments Comment from the forums

Gururu

Watching this with popcorn. I don't know, it seems to me that OpenAI has done nothing but pilfer itself into existence. Everyone else probably doing the same thing as far as their AI products go, but at least most of them already had a good thing going (Apple, Google, X, Microsoft, Meta, etc). And just not hearing the same kind of intellectual property abuse from Anthropic.
Reply
TheOtherOne

https://media3.giphy.com/media/v1.Y2lkPTc5MGI3NjExYmgyYmo2b2QwNW03bGF3dTdtZ25rZWc0azBrdWJudWQ4azZxeTM1MSZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/3o7TKL8SM4YJLr4waA/giphy.gif
Reply
emike09

This is the direct result of Apple and Apple employees not using safe AI practices. Don't reveal your everything to AI so you can get a better or quicker response.

In another part of the world - "Man makes child with woman, and she didn't think she could get pregnant since she hasn't gotten pregnant before."
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legofjoy

Apple being angry is just irony; when their gimmick is tricking lower IQ that 2FA is an entire security system, stripping out basic ports & features, and offering basic free cloud apps as if they're exclusives e.g. apple cloud syncs or is forced on actually which is a step worse than onedrive or other examples.

Meanwhile everything else they've made is at really low, or barely working, standards. Once you develop anything for it you'll see how terrible it is and how they break things with 0 standards and documentations every few versions; it only gives an outward appearance of working but is held to clearly no standards, and their idea of securities are just nonworking keys and gimmicks upon gimmicks that are essentially hardcoded passwords; they could break things and not explain why it just doesn't work etc and that is normal for them.

For example, the entire iphone is just forced webapps that are usually optional apps integrated as if it's the operating system; from sync, 2fa, and other free things they enforce as if it's 'exclusive' security and backups. Let's ignore the 1-port critiques where the 1 exclusive port is not compatible with anything else.

Only hipsters use apple ? I'd say it's an accurate stereotype anyway.

The idea they lost some trade secret is funny as if they ever had some 😂
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martinezjosei123

This in NOT an Apple or OpenAI problem; this is a CHINA problem. Chinese are required and mandated by the Chinese government to steal intellectual property from US companies. They can cover-up and blame or pretend it is between companies but the real destination is China.
Reply
micheal_15

Was only a matter of time before Apple claimed to have INVENTED large language models, chatgpt etc.

Things Apple claims to have invented (seriously) - ballpoint pens with logos on, a4 paper, curved surfaces, metallic frames/cases, hydrophobic glass coatings, external aerials, steel screws, the mouse, mechanical keyboards, butterfly keyboards, wireless trackpads, GUI, overlapping windows, plastic wheels on computer cases, microfiber computer cloths and now AI.

Thats not an exhaustive list but its stuff they've sued over.
Literally claiming to have invented the stuff, knowing they have deeper pockets than their target.

I'm just surprised they didn't take credit for inventing "murdering pakistani men to implant their liver in a fruit-obsessed unwashed evil CEO"
Reply
LordVile

martinezjosei123 said:
This in NOT an Apple or OpenAI problem; this is a CHINA problem. Chinese are required and mandated by the Chinese government to steal intellectual property from US companies. They can cover-up and blame or pretend it is between companies but the real destination is China.
Where did you get China from a lawsuit between two American companies?
Reply
LordVile

legofjoy said:
Apple being angry is just irony; when their gimmick is tricking lower IQ that 2FA is an entire security system, stripping out basic ports & features, and offering basic free cloud apps as if they're exclusives e.g. apple cloud syncs or is forced on actually which is a step worse than onedrive or other examples.
Can you reword that? Also when is iCloud ever “forced on”?

legofjoy said:
Meanwhile everything else they've made is at really low, or barely working, standards. Once you develop anything for it you'll see how terrible it is and how they break things with 0 standards and documentations every few versions; it only gives an outward appearance of working but is held to clearly no standards, and their idea of securities are just nonworking keys and gimmicks upon gimmicks that are essentially hardcoded passwords; they could break things and not explain why it just doesn't work etc and that is normal for them.
I mean I’d rather something “appear to be working” that not even manage it.

legofjoy said:
For example, the entire iphone is just forced webapps that are usually optional apps integrated as if it's the operating system; from sync, 2fa, and other free things they enforce as if it's 'exclusive' security and backups. Let's ignore the 1-port critiques where the 1 exclusive port is not compatible with anything else.
Are you from 2007? They tried the web app route be it didn’t work which is why the App Store was launched.

legofjoy said:
Only hipsters use apple ? I'd say it's an accurate stereotype anyway.

The idea they lost some trade secret is funny as if they ever had some 😂
They’ve been working on NPUs for ages now they should have a sizeable amount of IP.
Reply
Gururu

legofjoy said:
Apple being angry is just irony; when their gimmick is tricking lower IQ that 2FA is an entire security system, stripping out basic ports & features, and offering basic free cloud apps as if they're exclusives e.g. apple cloud syncs or is forced on actually which is a step worse than onedrive or other examples.

Meanwhile everything else they've made is at really low, or barely working, standards. Once you develop anything for it you'll see how terrible it is and how they break things with 0 standards and documentations every few versions; it only gives an outward appearance of working but is held to clearly no standards, and their idea of securities are just nonworking keys and gimmicks upon gimmicks that are essentially hardcoded passwords; they could break things and not explain why it just doesn't work etc and that is normal for them.

For example, the entire iphone is just forced webapps that are usually optional apps integrated as if it's the operating system; from sync, 2fa, and other free things they enforce as if it's 'exclusive' security and backups. Let's ignore the 1-port critiques where the 1 exclusive port is not compatible with anything else.

Only hipsters use apple ? I'd say it's an accurate stereotype anyway.

The idea they lost some trade secret is funny as if they ever had some 😂
If this is OpenAI defense, this will be the first comedy on Court TV.
Reply
Roland Of Gilead

Apple have been too far behind on the whole AI ting to begin with. This is just sour grapes. Apart from the misappropriated laptop, everything else (show and tell, knowledge transfer) happens all the time. Employees leave companies or are sacked, join another company, and transfer knowledge. This is nothing new.
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