Apple Sues OpenAI Over Trade Secret Theft: What the 41-Page Complaint Alleges

Apple filed a lawsuit against OpenAI on July 10, 2026, alleging trade secret misappropriation and breach of contract¹. The complaint was filed in the U.S. District Court for the Northern District of California, San Jose Division. The defendants include OpenAI Foundation and OpenAI Group PBC, the hardware subsidiary io Products that OpenAI acquired, and two former Apple employees: Tang Yew Tan, now OpenAI’s Chief Hardware Officer, and engineer Chang Liu¹.

The two companies partnered in 2024 to integrate ChatGPT into the iPhone — and are now heading to court³. The complaint opens bluntly: “This case is about Apple’s former employees stealing Apple’s trade secrets for the benefit of OpenAI. Apple brings this suit to put a stop to it.”¹

What the Complaint Alleges

Apple’s allegations run on two levels: the individual conduct of two former employees, and organizational involvement by OpenAI itself. All of these are Apple’s claims as stated in the complaint; OpenAI has yet to respond in court.

A Former Engineer’s Access to Confidential Files

Chang Liu spent more than eight years at Apple as a Senior System Electrical Engineer on the iPhone product line and joined OpenAI in January 2026¹. According to the complaint, Liu failed to return an Apple-issued laptop after leaving, and while employed at OpenAI exploited an authentication bug to access Apple’s shared network folders¹.

Apple alleges that over several weeks Liu downloaded dozens of confidential files, including “voluminous, detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data”¹. The complaint further claims he coached a former colleague he was recruiting to OpenAI on ways to “avoid trouble with the security team” when copying confidential Apple files¹.

Extracting Secrets Through Job Interviews

Tang Tan spent twenty-four years at Apple, most recently as Vice President of Product Design for iPhone and Apple Watch. After leaving, he co-founded io Products and now serves as OpenAI’s Chief Hardware Officer¹.

The complaint alleges that Tan used Apple’s internal project codenames in OpenAI job interviews to ask about unannounced products, and directed candidates still working at Apple to bring “actual parts” to interviews for “show and tell” sessions¹. According to the complaint, at least one candidate was surprised, commenting that he “didn’t even know we could take those from the office”¹. Apple also alleges that OpenAI as an organization instructed candidates to bring “CAD/design artifacts” and “prototypes” to interviews¹.

A Claim of Company-Wide Conduct

Beyond individual acts, Apple alleges systematic involvement: “at every level, from members of its Technical Staff to its Chief Hardware Officer, and in coordination with business partners, OpenAI has been stealing Apple’s trade secrets and confidential information”¹. The complaint also claims OpenAI had one of Apple’s partners carry out a proprietary Apple metal-finishing technique, misleading the partner into believing it had Apple’s permission¹.

Apple says it wrote to OpenAI in February 2026 to raise its concerns but never received a response¹.

What Apple Is Asking For

The complaint contains at least six claims for relief, built on the federal Defend Trade Secrets Act (DTSA) and on breaches of the Intellectual Property Agreements (IPAs) both men signed at Apple¹. Apple is asking the court for injunctions barring the use or disclosure of its trade secrets, evidence preservation, the return of Apple property, damages, exemplary damages for “willful and malicious” misappropriation, and attorneys’ fees, and it has demanded a jury trial¹. In a statement provided to TechCrunch, Apple said: “Recently, significant evidence has emerged suggesting individuals employed by OpenAI wrongfully took Apple’s secret and confidential information regarding our unreleased technologies, processes, and products.”²

OpenAI had not commented as of the initial reports².

From Partnership to Litigation

The relationship between the two companies has shifted dramatically over two years. In 2024, they announced a partnership integrating ChatGPT into the iPhone’s operating system, and Sam Altman visited Apple’s headquarters for the announcement³. CNBC describes the lawsuit as “a shocking reversal”³.

The turning point was OpenAI’s move into hardware. In 2025, OpenAI acquired io, the startup co-founded by former Apple designer Jony Ive, and began developing devices³. Tan, now a defendant, was a co-founder of io — and Apple’s complaint goes as far as arguing that “io is an alter ego of OpenAI,” treating the two as effectively one entity¹. Altman said in November 2025 that the first prototypes were finished³, and OpenAI’s first hardware product is reportedly a smartphone that uses AI agents instead of traditional apps².

Apple, meanwhile, has been putting distance between itself and OpenAI: according to CNBC, the updated Siri arriving this fall is based on Google’s Gemini models rather than ChatGPT³.

No Change to Products for Now — the Stakes Are in Hiring Risk

For everyday users, the immediate question is what happens to ChatGPT on the iPhone (the Apple Intelligence integration). Apple declined to comment on whether the lawsuit affects that partnership³. Nothing changes in the products today — this is a fight over confidential hardware development information, not over the services themselves.

From a business perspective, the case draws a legal line through the AI industry’s intense talent wars. Moving between AI companies — or hiring from a competitor — can now clearly escalate into litigation over how confidential information is handled. For hiring companies, Apple’s allegations spotlight a specific risk: eliciting a candidate’s previous employer’s information during interviews. Depending on how the case unfolds, it could affect the timing of hardware plans at OpenAI, which just made GPT-5.6 generally available and has been building out voice-first products that fit naturally with dedicated devices.

The full 41-page complaint is public on DocumentCloud¹, and OpenAI’s answer should clarify the disputed issues in the months ahead. Legal fights around generative AI are spreading beyond this case too: copyright-infringement defendant Midjourney is asking a court to force studios to disclose their internal AI use, and around the same time Illinois enacted an AI safety law requiring annual third-party audits — together showing the legal net around AI companies tightening from both litigation and regulation.