Apple sues OpenAI over trade secrets, seeks hardware redesign
Apple’s lawsuit accusing OpenAI of stealing trade secrets to build AI devices threatens to disrupt the startup’s hardware ambitions and marks the collapse of a critical partnership.
Apple filed a lawsuit against OpenAI in the U.S. District Court for the Northern District of California on Friday. The iPhone maker accuses the artificial intelligence company of systematically stealing confidential product designs and engineering documents.
The filing claims OpenAI orchestrated a coordinated effort to extract proprietary data to accelerate its own device development. The complaint specifically targets Tang Tan, OpenAI’s chief hardware officer and a former Apple vice president who led iPhone development.
It also names ex-Apple engineer Chang Liu, who allegedly downloaded engineering presentations and technical specifications before resigning earlier this year. Furthermore, Apple claims OpenAI coached departing staff to avoid immediate dismissal, allowing them to retain internal system access for longer periods.
Apple is demanding a jury trial and asking the court to force OpenAI to destroy the proprietary materials. Crucially for investors, Apple wants the court to order OpenAI to redesign its upcoming AI-powered hardware so it no longer incorporates the stolen technology. If granted, an injunction could severely delay the startup's expansion beyond software into physical consumer electronics.
“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 stated in the filing. Apple added that OpenAI’s hardware ambitions are “built on the illegal reliance on misappropriated trade secrets.”
OpenAI denied the claims, with a spokesperson stating: “We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.”
A Fractured Partnership
The legal action represents a dramatic reversal from 2024, when Apple integrated OpenAI’s ChatGPT into its Siri and Apple Intelligence platforms. The relationship deteriorated as OpenAI aggressively hired Apple talent, including former design chief Jony Ive, to develop a new generation of AI hardware devices. More than 400 former Apple employees now work at OpenAI, highlighting the intense competition for AI expertise.
The dispute also complicates the regulatory landscape for both companies. Earlier in 2025, Elon Musk’s xAI sued Apple and OpenAI in a Texas federal court, accusing them of conspiring to suppress competition by locking up the AI market. That lawsuit, which seeks billions in damages, alleged the ChatGPT integration was an exclusive arrangement designed to block rivals like Grok from reaching users.
