Apple has filed a lawsuit against OpenAI, accusing the maker of ChatGPT of illegally hiring its employees and persuading them to hand over confidential designs and strong trade secrets to build a rival hardware device, a dramatic rift between two firms that were partners two years ago.
“Recently, significant evidence has emerged suggesting that individuals employed by OpenAI have improperly obtained Apple’s proprietary and confidential information about our unreleased technologies, processes and products,” an Apple spokesperson said in an email.
The complaint, which was filed on Friday, does not say anything. “OpenAI’s fledgling hardware business now rests on a shaky foundation, one that has been tainted by its illegal reliance on unlicensed trade secrets,” Apple wrote.
Among those named is Tang Yew Tan, chief executive of OpenAI and former vice president of Apple, who is accused of taking information from Apple suppliers and encouraging interviewees to reveal confidential material.
“He instructed job seekers who still work for Apple to bring ‘real parts’ from Apple to their interviews for ‘show and tell’ sessions where he and his team at OpenAI could obtain some of Apple’s confidential information,” the complaint reads.
Another former Apple employee, Chang Liu, is accused of leaving an Apple laptop and using an authentication flaw to breach the company’s internal network, downloading “a large number of confidential Apple hardware-related files”.
Drew Pusateri, a spokesman for OpenAI, said the company is reviewing the filing. “We are not interested in the trade secrets of other companies,” he added. “We remain focused on creating new technologies that empower people everywhere.”
From partners to plaintiffs
The case is a sharp change for the two companies that announced a major partnership in 2024, when Apple agreed to integrate ChatGPT into applications for iPhones, iPads and Macs. When Apple showed off its updated Siri voice assistant last month, however, its AI component was built on Google’s Gemini model instead.
Tensions flared when OpenAI spent $6.4bn to acquire io Products, a hardware startup founded by former Apple design guru Jony Ive, who is also named in the suit. The lawsuit comes at a critical time for OpenAI, which is gearing up for one of the biggest stock markets the tech sector has ever seen.
Apple is seeking damages and an injunction barring OpenAI from possessing or using its trade secrets.
A lesson for UK business owners
If a company with Apple’s security services and legal firepower can watch its secrets walk out the door and employees leave, smaller firms should take notice. The loss of intellectual property is always one of the biggest threats to any business, and for many SMEs the crown jewels reside in too few heads, with too few safeguards.
In the UK, trade secrets are protected under the general antitrust law and the Trade Secrets (Enforcement, etc.) Regulations 2018, but only where a business can show it took reasonable steps to keep the information confidential. The Intellectual Property Office advises limiting access to those who need it, setting clear expectations and using non-disclosure agreements.
For owner-managers, the basics that work are cheaper than any court: watertight privacy clauses in employment contracts, opt-out procedures that revoke system access on day one, and a clear record of who can see what. The dos and don’ts of protecting intellectual property are well established, and almost all of them work better before a dispute than during one.
Apple v OpenAI will be fought by California’s legal forces. For everyone, the smarter money is on making sure that the plan and tell doesn’t happen.
