Apple Sues OpenAI and Former Employees for Alleged Theft of Trade Secrets

Apple has filed a federal lawsuit against OpenAI, accusing the ChatGPT maker of orchestrating a systematic campaign to steal confidential hardware designs, manufacturing processes, and supplier relationships through more than 400 former Apple employees now working at OpenAI.

The 41-page complaint, filed July 10, 2026, in the U.S. District Court for the Northern District of California, names OpenAI, its hardware subsidiary io Products, Chief Hardware Officer Tang Yew Tan, and former senior systems electrical engineer Chang Liu as defendants.

Apple describes the alleged scheme as operating “at every level, from members of its Technical Staff to its Chief Hardware Officer,” as OpenAI pushes to build its own consumer hardware device.

Tan, who spent 24 years at Apple and most recently served as Vice President of Product Design for iPhone and Apple Watch, is accused of using insider knowledge of confidential Apple projects to extract more information during OpenAI job interviews with current Apple employees.

The complaint alleges he used internal project codenames to ask candidates “What’s the plan[?]” for unannounced Apple products and directed job candidates to bring “actual parts” from Apple offices for “show and tell” sessions, a request that reportedly surprised at least one candidate who said he “didn’t even know we could take those from the office”.

Apple further alleges Tan possessed and distributed an internal “Need to Know” document detailing Apple’s offboarding and security procedures, giving new OpenAI hires advance notice of the forensic checks they would face upon resigning.

Liu, who left Apple for OpenAI in January 2026, allegedly retained an Apple-issued laptop after his departure and told a former colleague he “still have[d] another computer” to access company data.

Apple says Liu exploited a previously unknown authentication flaw to gain continued access to Apple’s network storage, then downloaded dozens of confidential files, including a compilation running over a thousand pages documenting engineering work, plus a presentation detailing manufacturing and testing procedures for multi-layer main logic boards.

Rather than disclose the vulnerability, Apple claims Liu joked about it in messages, writing “LOL” and “so funny”. He is also accused of coaching a colleague, identified in related reporting as Alyssa Peng, on which confidential materials to study before her own OpenAI interview and how to remove files without alerting Apple’s security team.

Beyond internal documents, Apple alleges OpenAI misled a longtime manufacturing partner into performing Apple’s proprietary metal-finishing technique without authorization, and separately approached a battery and power supplier using insider terminology to probe for details on specific Apple components.

Apple says it has observed a broader pattern of departing employees deliberately evading exit security reviews, which it attributes to coaching from OpenAI on how to avoid scrutiny.

Legal and Industry Implications

The lawsuit centers on claims of trade secret misappropriation and breach of contract, with Apple seeking to halt what it calls an ongoing pattern rather than an isolated incident. The case underscores intensifying competition between Apple and OpenAI as the AI company pushes further into consumer hardware.

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