Apple Sues OpenAI Over Alleged Theft of Trade Secrets via Former Employees

Apple (AAPL-US) filed a 41-page lawsuit last week against artificial intelligence (AI) startup OpenAI, alleging that the company systematically and deliberately stole Apple’s trade secrets through several former employees. The lawsuit not only details specific instances of data leakage but also targets OpenAI’s internal recruitment culture and governance, making it a potentially landmark case that could reshape the tech industry.

According to Fortune, the core of the complaint focuses on two relatively low-profile but strategically important former Apple employees: Chang Liu and Tangyao Tan. Apple alleges both violated non-compete and confidentiality agreements and breached the U.S. Defend Trade Secrets Act. The stolen information reportedly includes 'some of the most valuable intellectual property in American business.'

Liu worked at Apple for eight years as a senior systems electrical engineer and joined OpenAI’s San Francisco office in January this year. Apple claims Liu left without returning at least one company-issued laptop and refused to attend an exit interview, failing to confirm the return of all equipment.

More alarmingly, Liu maintained close contact with Peng Yuting, a current Apple employee, after leaving. The complaint states that Peng continued to share core details of Apple’s internal projects with Liu. Roughly four months later, Peng also joined OpenAI.

Apple further alleges that Liu helped Peng prepare for her OpenAI interview, coaching her on how to leverage Apple’s confidential information to secure the job.

Apple claims Liu used Peng’s internal Apple account to log into company systems and, using his unrecovered laptop, accessed Apple’s intranet. According to communications cited in the complaint, Liu expressed surprise at having 'accidentally gained access to cloud storage.'

He is then accused of downloading dozens of confidential hardware development documents, including details of unreleased products, engineering briefings, technical specifications, and proprietary project data—one example being a presentation on the manufacturing and testing of a hardware circuit board.

When Peng officially transitioned to OpenAI, Liu allegedly helped her bypass security monitoring to copy and transfer specific files.

Notably, Apple did not name Peng as a defendant in the case.

25-Year Veteran Joins OpenAI—Interviews Allegedly Used as Intelligence Gathering

The other defendant, Tangyao Tan, served Apple for nearly 25 years and led product design for the iPhone and Apple Watch.

He left Apple in March 2024, first joining a then-undisclosed hardware startup. Subsequent evidence suggests this startup was io, co-founded by Apple’s former design chief Jony Ive, which later merged with OpenAI.

In July 2025, Tan’s title was updated to Chief Hardware Officer at OpenAI, the same month io was officially absorbed into the company.

Apple alleges that after joining OpenAI, Tan conducted interviews with current Apple employees and deliberately mentioned internal project codenames during conversations to prompt them to reveal more confidential details. Apple estimates that OpenAI has recruited approximately 400 former Apple employees.

The complaint also states that Tan asked applicants to bring CAD design files and product prototypes to interviews and disclosed information about Apple’s suppliers. Some employees later admitted they were unaware such documents and prototypes 'could be taken out of the office.'

Apple further claims Tan advised potential defectors to delay revealing their next destination and remain at Apple as long as possible.

Before leaving, Tan reportedly obtained an internal document outlining Apple’s employee exit security review process, which allegedly became a reference for others he recruited to OpenAI to evade detection.

Notably, Jony Ive, the high-profile former Apple executive now leading AI hardware development at OpenAI, is not named as a defendant. However, the complaint references his involvement multiple times, noting that both Liu and Tan were formerly his subordinates.

Apple has named both Ive’s co-founded company io and OpenAI as co-defendants.

In response, OpenAI stated it 'has no intention of stealing any company’s trade secrets' and is currently reviewing the complaint, declining further comment. The company emphasized its continued focus on developing innovative technologies that benefit users worldwide.

Deteriorating Relations Between Apple and OpenAI

This lawsuit reflects the cooling relationship between Apple and OpenAI.

In late 2024, the two companies collaborated to integrate ChatGPT functionality into the revamped Siri voice assistant—a service still in use today.

At the time, Apple’s in-house high-end AI model development was lagging, so it opted to leverage OpenAI’s technology. However, in January 2025, Apple selected Google’s Gemini as its long-term AI partner, marking a clear shift. The lawsuit now further strains their relationship.

A key point of external interest is OpenAI’s long-gestating, highly secretive AI end-user device.

OpenAI CEO Sam Altman described early prototypes in May 2024 as 'the coolest product in human history.' Over a year later, specific specifications remain undisclosed. Market speculation suggests the device could directly compete with smartphones, becoming a primary AI interface in mobile settings. Possible forms include smart glasses or wearable AI devices.

Apple’s complaint also alleges OpenAI has been contacting Apple’s long-established supply chain, potentially aiming to have suppliers manufacture similar components for OpenAI’s upcoming hardware.

The complaint notes Tan emailed supplier information to his personal account before leaving. Another anonymous OpenAI employee allegedly contacted Apple suppliers, requesting parts be manufactured using Apple’s proprietary metal fabrication techniques, leading suppliers to believe they had Apple’s authorization.

Apple states that when it initiated its investigation in February 2025, it sent OpenAI a letter asking what measures were in place to prevent leaks—but received no response.

Apple emphasizes that the current allegations represent only 'the tip of the iceberg,' as the investigation so far has been limited to data left on company-issued devices. During the upcoming discovery phase, the scale of illicitly obtained secrets could be many times larger.

Apple has retained the prestigious U.S. law firm Weil, Gotshal & Manges, known for handling landmark white-collar crime cases like the Enron bankruptcy. Analysts widely believe the outcome of this lawsuit could significantly impact both companies’ strategic trajectories and have far-reaching consequences for the entire tech industry.

This is not OpenAI’s only recent legal challenge. In May 2025, OpenAI won a lawsuit brought by Elon Musk, with a jury dismissing all of Musk’s claims. In June, the Florida government sued OpenAI for allegedly failing to adequately disclose product risks, particularly potential harms to children.

The day before Apple’s lawsuit, The New York Times escalated its copyright lawsuit against OpenAI, accusing the company of concealing evidence.