Apple Sues OpenAI, Calling Its Hardware Business 'Rotten to Its Core' With Stolen Trade Secrets
Apple filed suit in the Northern District of California, accusing OpenAI of systematic trade secret theft — from interview 'show and tell' sessions with Apple parts to an engineer who allegedly kept a work laptop and siphoned confidential files. OpenAI denies it.
Apple sued OpenAI for trade secret theft on July 10, filing in the US District Court for the Northern District of California. The complaint’s language is unusually savage for Cupertino legal filings: Apple calls OpenAI’s hardware business “rotten to its core by its illegal reliance on misappropriated trade secrets,” and alleges the theft ran “at every level, from members of its Technical Staff to its Chief Hardware Officer.”
That Chief Hardware Officer is Tang Tan, named directly in the suit. Tan spent 24 years at Apple, rising to VP of product design for iPhone and Apple Watch, before joining OpenAI. Apple alleges he directed Apple employees interviewing at OpenAI to share company secrets — including telling candidates to bring “actual parts” from Apple to interviews for “show and tell” sessions. The complaint also says OpenAI used Apple’s internal project code names in recruiting.
The second named defendant is Chang Liu, a senior systems electrical engineer with eight years at Apple. The suit alleges Liu kept his work-issued Apple laptop after leaving, discovered a bug that let him reach Apple’s cloud file storage, and — while building hardware for OpenAI — accessed and downloaded dozens of confidential files from Apple’s network. If that allegation holds up, it moves the case from aggressive recruiting into something closer to straightforward computer intrusion.
Apple wants OpenAI barred from using or disclosing its trade secrets, the return of confidential materials, and evidence preservation orders. OpenAI’s response was four sentences short of a shrug: “We have no interest in other companies’ trade secrets.”
The backdrop makes the fight inevitable in hindsight. OpenAI bought Jony Ive’s design startup io Products for roughly $6.5 billion in 2025 and has been staffing a consumer hardware division ever since — more than 400 former Apple employees now work there, many from the chip design, hardware, and on-device AI teams. io Products is named in the filing; Ive himself is not. This is also the same partnership that put ChatGPT inside Apple Intelligence in 2024. That alliance is now dead in every way that matters — Apple has since moved Siri’s backbone to Google’s Gemini.
California’s courts have made poaching-adjacent cases hard to win; the state bars non-competes, and hiring a rival’s talent is legal. But Apple’s complaint is built around specific artifacts — parts in interview rooms, a retained laptop, downloaded files — not just résumés. Waymo extracted a $245 million settlement from Uber on a similar factual shape. OpenAI is building toward an IPO. It cannot afford years of discovery into how its hardware division was born.