Apple sued OpenAI on July 10, alleging that the AI company built its nascent hardware business on stolen Apple trade secrets in a complaint the iPhone maker says shows misconduct "at every level, from members of its Technical Staff to its Chief Hardware Officer." The suit, filed in the U.S. District Court for the Northern District of California, names OpenAI as a corporate defendant alongside two individuals: Tang Tan, OpenAI's Chief Hardware Officer, and Chang Liu, an engineer who joined OpenAI earlier this year.
The allegations against Tan are the most pointed. Apple says the 24-year company veteran, who most recently led product design for the iPhone and Apple Watch before departing for OpenAI, used Apple's internal, confidential project code names while recruiting candidates for OpenAI's hardware team. The complaint further alleges Tan coached departing Apple employees on how to evade the company's security and exit procedures, solicited details about unannounced Apple products from people still on Apple's payroll, and in at least one case asked a job candidate to bring an actual Apple hardware component to an interview for a "show and tell."
Chang Liu, who joined OpenAI in January 2026 after roughly eight years at Apple as a senior systems electrical engineer, is separately accused of failing to return his Apple-issued laptop after his departure and using it to download dozens of confidential Apple files -- described in the filing as "voluminous, detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data." Apple alleges Liu then shared that material with other Apple employees who were separately interviewing at OpenAI.
“OpenAI pushed back directly: a company spokesperson said, "We have no interest in other companies' trade secrets.”
The complaint ties the alleged misconduct directly to OpenAI's hardware ambitions, which trace to its $6.5 billion acquisition of io, the design startup co-founded by former Apple chief design officer Jony Ive, in May 2025. Apple's filing goes so far as to argue that "OpenAI's nascent hardware business now rests on the shakiest of foundations, rotten to its core." Ive himself is referenced in the complaint but was not named as an individual defendant.
Apple is asking the court to bar OpenAI from using or disclosing any of the disputed material, to order the return of confidential files, and to preserve evidence relevant to the case -- setting up a discovery fight that will test how much of OpenAI's hardware roadmap was actually built independently. OpenAI pushed back directly: a company spokesperson said, "We have no interest in other companies' trade secrets. We remain focused on building innovative technology that empowers people everywhere."
The timing is pointed. Apple and OpenAI remain commercial partners -- ChatGPT has been integrated into iOS since 2024 -- even as OpenAI has spent the past year assembling a hardware team explicitly aimed at competing with the kind of consumer devices Apple has built its business on. A trade-secret finding wouldn't just be a legal setback for OpenAI's device ambitions; it would hand Apple a powerful discovery record right as OpenAI is trying to project stability to enterprise customers, hardware partners and prospective IPO investors simultaneously.
For founders building hardware or deep-tech products with former Big Tech talent, the case is a reminder that recruiting practices around code names, physical components and departing-employee coaching are exactly the kind of internal detail that becomes public and actionable in litigation. What to watch next: whether OpenAI moves to dismiss or seeks a protective order narrowing discovery, and whether Apple's suit slows any near-term hardware announcements OpenAI had been planning around its io-derived device line.