Apple filed a lawsuit against OpenAI and its hardware chief, Tang Tan, on Friday for allegedly stealing the iPhone-maker’s trade secrets, including unreleased parts and prototypes, confidential designs, and documents about stealth projects, according to WIRED. The lawsuit, filed in US district court in San Jose, opens what may become the highest-stakes intellectual property battle in Silicon Valley since Waymo sued Uber in 2017.
The Allegations in Detail
The lawsuit accuses Tang Tan, who spent 24 years at Apple and oversaw iPhone product design, and his colleagues at OpenAI of encouraging people departing or considering leaving Apple to bring with them proprietary and unreleased technology. According to the filing, Tan allegedly helped coach recruits on how to evade Apple’s data security protocols and directed them to bring confidential Apple parts to job interviews at OpenAI.
Apple’s investigation relied on data and messages gathered from its employees’ devices. The company caught onto the alleged theft early this year after Chang Liu, an electrical engineer at OpenAI who was at Apple until January, never returned his company-issued laptop and wrote to a former colleague about still having access to Apple’s internal file-sharing system, according to the lawsuit. Apple says in the filing that Liu’s access was enabled by a bug that’s now been fixed. Liu “downloaded dozens of Apple’s confidential hardware-related files,” including a presentation on manufacturing and testing complex circuit boards used in Apple’s hardware. The lawsuit also states that Liu coached an Apple employee he was recruiting to join OpenAI on how to “‘avoid trouble with the security team’ when copying confidential Apple files.”
A Pattern of Recruiting and IP Theft
OpenAI has hired more than 400 former Apple employees, according to the lawsuit. That includes several former Apple veterans leading OpenAI’s development of AI-powered consumer devices. Last year, OpenAI paid $6.5 billion to acquire io Products, a startup cofounded by longtime Apple executives including Tan, Scott Cannon, Evans Hankey, and famed designer Jony Ive. io Products and Chang Liu are also named as defendants in the lawsuit.
Apple learned that before leaving, Tan emailed himself information about the company’s suppliers. Other employees leaving for OpenAI have done the same, Apple alleges. In addition, Tan “has directed job candidates still working for Apple to bring ‘Actual parts’ from Apple to their [interviews],” the lawsuit states.
Apple wrote to OpenAI in February raising initial concerns about alleged theft but did not receive any response, leading to further investigation and the filing of the lawsuit.
Comparison to Waymo-Uber Case
The lawsuit draws parallels to the 2017 dispute between autonomous ride-hailing company Waymo and Uber. Waymo accused Uber of stealing hardware designs when it brought on a former Waymo engineer who had left with thousands of confidential files. Uber agreed to pay $245 million to settle the lawsuit during the middle of a trial the following year.
| Case | Settlement Amount | Key Allegation |
|---|---|---|
| Waymo v. Uber (2017) | $245 million | Theft of hardware designs via ex-employee |
| Apple v. OpenAI (2026) | Pending | Theft of trade secrets including prototypes and supplier data |
Legal and Business Implications
“OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets,” Apple says in the lawsuit. The company describes OpenAI as resorting “to taking unlawful shortcuts” while under “mounting pressure to deliver its first commercial hardware product.”
Apple and OpenAI have been partners since 2024, when the companies announced a landmark deal to distribute ChatGPT on iPhones, Macbooks, and iPads. But the relationship has frayed in recent years, prompting Apple to rely more on Google’s Gemini AI technology as the foundation for the company’s in-house AI models. OpenAI and Apple are expected to more fiercely compete in the coming years in the emerging market for AI-powered consumer devices.
Apple spokesperson Hannah Smith said the company “will always defend our teams' hard work and innovations, and we are taking all appropriate steps to do so.” OpenAI and Tan did not immediately respond to requests for comment.
For enterprise technology decision-makers, the case underscores critical risks in hardware partnerships and IP protection when collaborating with AI companies. The alleged theft of supplier information and manufacturing processes highlights vulnerabilities that could affect supply chain security. As the legal battle unfolds, CTOs and procurement leaders should review their own data security protocols and vendor agreements to prevent similar misappropriation of trade secrets.
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