Apple filed a lawsuit against OpenAI on July 10 in the U.S. District Court for the Northern District of California, accusing the AI lab, its hardware venture io Products, and two former Apple employees of a coordinated scheme to steal confidential Apple trade secrets to accelerate development of OpenAI's own consumer AI hardware. The case is captioned Apple Inc. v. Chang Liu, et al., No. 5:26-cv-07078.

What Apple alleges

The complaint names Chang Liu, a former Apple senior systems electrical engineer, and Tang Yew Tan, OpenAI's chief hardware officer and formerly Apple's vice president of product design for iPhone and Apple Watch. Apple alleges Liu downloaded dozens of confidential hardware-related files before leaving the company, including detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data, and that OpenAI coached departing Apple staff on how to evade the company's offboarding security checks. Apple further alleges Tan used Apple's internal project code names while recruiting candidates for OpenAI and asked prospective hires to bring in Apple hardware components and discuss component and vendor selection during interviews. Apple says the misconduct reached "every level" of OpenAI's hardware effort and was directed by senior leadership.

OpenAI's response

OpenAI denied wrongdoing, saying in a statement: "We have no interest in other companies' trade secrets. We remain focused on building innovative technology that empowers people everywhere."

Why it matters

The suit formalizes a rupture between two companies that were close partners as recently as 2024, when ChatGPT was built into iOS. Relations cooled after OpenAI acquired Jony Ive's device startup io for roughly $6.4 billion and signaled plans to compete directly in consumer hardware — the same market Apple has dominated for nearly two decades. Beyond the specific trade-secret claims, the case is a test of how aggressively incumbent hardware makers will use litigation to slow AI labs that are hiring away senior product talent to build competing devices, and it adds a legal front to what was already an intensifying rivalry between Apple and OpenAI over the next generation of AI-native hardware.