Law360 (July 10, 2026, 4:43 PM EDT) -- Apple filed a trade secret lawsuit Friday against OpenAI, its acquired hardware startup io Products and two former Apple employees, alleging in California federal court that the defendants engaged in a coordinated scheme to misappropriate Apple's confidential information to accelerate OpenAI's push into consumer hardware.

The complaint accuses Tang Tan, Apple's former vice president of product design for iPhones and Apple Watches, who is now OpenAI's chief hardware officer, and former Apple engineer Chang Liu of improperly using Apple information after leaving the company. It also alleges OpenAI encouraged candidates to disclose confidential materials, leveraged insider knowledge in recruiting and supplier outreach and benefited from the resulting trade secret misappropriation.

"This is the tip of the iceberg," Apple said in its complaint. "Apple lacks visibility into what's been happening behind closed doors at OpenAI, where such misconduct is normalized and exemplified by leadership."

Apple is seeking preliminary and permanent injunctive relief, the return of allegedly misappropriated information, orders preserving evidence, monetary damages and attorney fees and costs.

An OpenAI spokesperson said in a statement to Law360 Friday that the company has "no interest in other companies' trade secrets."

"We remain focused on building innovative technology that empowers people everywhere," the statement said. 

Apple alleges that Liu, who left the company in January to join OpenAI, retained an Apple-issued laptop and later exploited what Apple described as a previously unknown authentication vulnerability that allowed him to access internal file repositories after his departure. According to the complaint, Liu downloaded dozens of confidential files, including engineering presentations, technical specifications and information concerning unreleased products, and exchanged Apple information with a then-current Apple employee whom he was recruiting to OpenAI.

The complaint also alleges that Tan, who had spent 24 years at the company, used Apple's internal project codenames while interviewing Apple employees, encouraged candidates to bring Apple hardware components to "show and tell" sessions, and circulated an internal Apple document marked "Need to Know" describing security procedures used when employees leave the company.

Apple alleges it first tried to address the issue outside of court, contacting OpenAI in February while its investigation was still in its early stages. After asking OpenAI to investigate whether Apple's confidential information was being used improperly and to explain any preventive measures it had in place, "OpenAI never responded," according to the complaint.

"This necessitated Apple's further investigation, revealing the alarming unlawful conduct discussed above," the complaint said.

Apple's complaint said the alleged misconduct extends beyond the two named former employees. The company claims OpenAI has hired hundreds of former Apple employees and engaged in a broader effort to extract, retain and use Apple's confidential information in hardware development, supply-chain operations and recruiting.

Apple contends the alleged theft of its trade secrets has helped OpenAI shortcut years of research, manufacturing development and supplier relationships as it seeks to expand into consumer devices. As a result, the complaint alleges that "OpenAI's nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets."

Counsel for the defendants was not immediately available.

Apple is represented by Gabriel S. Gross and Christopher W. Henry of Weil Gotshal & Manges LLP.

The case is Apple Inc. v. Chang Liu et al., case number 5:26-cv-07078, in U.S. District Court for the Northern District of California.

--Editing by Dave Trumbore.

Update: This story has been updated with a statement from OpenAI.

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