Apple sues OpenAI over alleged hardware trade secret theft

By Alex Mercer · 2026-07-21

The core allegations

Apple filed its complaint in the U.S. District Court for the Northern District of California on 10 July 2026, Case No. 5:26-cv-07078, naming Chang Liu, Tang Yew Tan, OpenAI Foundation, OpenAI Group PBC, and io Products, LLC as defendants.^[1] The filing lands at a sharp angle: Apple and OpenAI have collaborated since 2024, integrating ChatGPT into Siri and Apple Intelligence, making this a lawsuit between commercial partners.

Apple said in its complaint: "OpenAI's nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets."verifiedVerified Source: files.openclassactions.com^[1] The case is brought under the federal Defend Trade Secrets Act and breach-of-contract claims, covering conduct Apple says ranged from illicit file downloads to recruiting techniques designed to extract proprietary knowledge from departing staff.

Chang Liu and the stolen laptop

Chang Liu is identified in the complaint as a former Apple Senior System Electrical Engineer who left the company in January 2026.^[1] Apple alleges Liu failed to return an Apple-issued laptop upon departure, then made use of it roughly six weeks later.

On 9 February 2026, Liu allegedly exploited an unknown authentication bug to access Apple's systems and download dozens of confidential hardware files, including a multi-layer logic board manufacturing and testing presentation.verifiedVerified Source: files.openclassactions.com^[1] Apple's complaint frames this not as opportunistic curiosity but as a deliberate extraction timed to benefit Liu's new employer.

Tang Yew Tan and the interview show-and-tell

OpenAI's Chief Hardware Officer Tang Yew Tan is accused of running a systematic effort to extract Apple's intellectual property through the hiring process itself.^[1] The complaint alleges Tan used Apple internal project code names during job interviews to probe candidates about unreleased products, signalling he already knew enough about Apple's internal taxonomy to ask targeted questions.

Tang Yew Tan allegedly directed candidates to bring actual Apple parts, including batteries, systems-in-package, logic boards, and shields, for physical show-and-tell sessions during interviews.^[1] The complaint further alleges Tan circulated an Apple document marked "Need to Know" to help recruits understand and evade Apple's exit security review procedures, describing what Apple characterises as a structured pipeline for moving hardware knowledge into OpenAI before engineers had cleared Apple's offboarding process.

The supplier angle

Apple alleged OpenAI or its affiliate io Products misled a trusted Apple supplier into performing Apple's proprietary multi-step metal-finishing technique, and separately approached a second supplier using insider terminology to inquire about confidential components without Apple's permission.verifiedVerified Source: files.openclassactions.com^[1] The metal-finishing claim points to manufacturing know-how rather than software code, the physical craft embedded in Apple's product design that rarely appears in public documentation.

Apple's supplier relationships are built on strict confidentiality agreements and often represent decades of joint process development. The complaint's supplier allegations suggest the alleged misappropriation extended beyond document downloads and recruiting, reaching into the physical production chain that underpins Apple's hardware differentiation.

What Apple wants, and what it means for OpenAI's hardware push

Apple is seeking preliminary and permanent injunctions to bar use and disclosure of its trade secrets, orders to preserve evidence and return materials, damages for losses and unjust enrichment, a reasonable royalty, and exemplary damages under the Defend Trade Secrets Act.^[1] Apple has flagged it will move promptly for a preliminary injunction, a step that, if granted, could freeze OpenAI's consumer hardware programme before the case reaches trial.

The hardware programme in question is closely tied to io Products, a company co-founded by former Apple design chief Jony Ive and acquired by OpenAI in May 2025. Drew Pusateri, OpenAI's Director of Strategic Communications, said: "We have no interest in other companies' trade secrets. We remain focused on building innovative technology that empowers people everywhere."^[2]

Pusateri's statement did not address the specific factual allegations in Apple's complaint, including the retained laptop, the authentication bug, the parts-to-interview directive, or the supplier contacts. OpenAI has not filed a substantive response in court as of the filing date.

Apple filed its complaint on 10 July 2026 in the Northern District of California, San Jose Division, Case No. 5:26-cv-07078.

Alex Mercer

Alex Mercer covers technology, energy and infrastructure for Bushletter, from data centres to the power stations that feed them. He likes the physical end of the story: the plants, the grids and the machines everything else depends on.