Apple Takes OpenAI to Court Over Alleged Hardware Theft

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Apple sues OpenAI for allegedly stealing hardware secrets

Apple Launches Legal Offensive Against OpenAI Over Alleged Trade Secret Theft

In a high-stakes legal battle that could reshape the future of consumer electronics, Apple has filed a formal lawsuit against OpenAI. The tech giant alleges that the AI startup engaged in a calculated campaign to pilfer proprietary hardware secrets, effectively attempting to fast-track its own hardware ambitions by leveraging Apple’s decades of R&D.

The litigation, filed in response to what Apple describes as a “pattern of theft,” targets not only OpenAI but also IO Products-the hardware startup founded by legendary designer Jony Ive, which OpenAI acquired in 2025. Furthermore, the suit names two former Apple engineers now at OpenAI: Tang Tan, the startup’s current chief hardware officer, and Chang Liu.

Allegations of Systematic Intellectual Property Misappropriation

Apple’s legal filing paints a picture of a deliberate, top-down effort by OpenAI to bypass the lengthy innovation cycles required to build world-class hardware. According to the complaint, the strategy involved poaching key talent and incentivizing them to bring sensitive intellectual property across the aisle.

The accusations against Chang Liu are particularly damning. Apple claims that after his departure, Liu continued to access internal systems to download a massive cache of confidential files. These allegedly included technical specifications, engineering presentations, and data on unreleased product roadmaps. Even more concerning, the suit alleges that Liu coached a former colleague on how to exfiltrate data while evading Apple’s internal security protocols, specifically suggesting the use of encrypted platforms like Line Messenger to mask their communications.

Weaponizing Talent and Supply Chains

The lawsuit suggests that the “brain drain” from Cupertino to San Francisco is more than just a standard industry hiring trend. Apple reports that over 400 of its former employees are now on the OpenAI payroll. The company alleges that OpenAI recruiters have actively encouraged departing Apple staff to ignore non-disclosure agreements and bring along “CAD/design artifacts” and physical prototypes to their interviews.

Beyond personnel, Apple claims OpenAI has attempted to compromise its supply chain. The suit alleges that OpenAI pressured a long-term Apple manufacturing partner-specializing in advanced industrial design and metal finishing-to apply Apple’s proprietary, trade-secret processes to OpenAI’s own hardware components.

A Foundation Built on Stolen Innovation?

Apple’s stance is clear: OpenAI’s upcoming hardware, slated for a 2026 release, is fundamentally compromised. In its statement, Apple emphasized that it takes the protection of its intellectual property as a core pillar of its business model, noting that it had attempted to resolve these concerns privately in February. According to Apple, OpenAI’s failure to respond to those inquiries left them with no choice but to pursue litigation.

“OpenAI’s nascent hardware business now rests on the shakiest of foundations,” the lawsuit asserts, characterizing the startup’s progress as “rotten to its core” due to its reliance on misappropriated data.

The Broader Implications for AI Hardware

This legal confrontation highlights the growing friction between software-first AI companies and traditional hardware manufacturers. As AI models move from the cloud to the edge-integrated directly into devices-the value of hardware-software integration has skyrocketed.

For context, the global AI hardware market is projected to reach over $200 billion by 2030, according to recent industry analysis. With such massive capital at stake, the pressure to ship competitive devices has led to an aggressive “arms race” for talent and technical blueprints. By taking this step, Apple is signaling that it will aggressively defend the “secret sauce” of its supply chain and engineering processes, setting a precedent for how intellectual property disputes will be handled in the era of generative AI.

As of now, both OpenAI and the named defendants have remained silent, leaving the industry to wait

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Why Personalization Matters

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How to Get Started

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