From flagship partnership to federal court
Apple has sued OpenAI in federal court in Northern California, alleging trade secret theft and breach of contract - a striking reversal for two companies that entered a high-profile partnership in 2024 to put ChatGPT inside Apple Intelligence. Apple's framing is unusually aggressive: it says the case is about former Apple employees stealing trade secrets for OpenAI's benefit, and that the conduct was not the work of rogue individuals but coordinated - in the complaint's language, running at every level from members of its Technical Staff to its Chief Hardware Officer, in coordination with business partners. IO Products is also named. The core commercial motive Apple alleges: OpenAI took Apple's intellectual property to develop its own consumer hardware device, which Altman said in November had reached first prototypes.
The specific allegations
Apple says its investigation - conducted the usual way, by analysing communications on company devices and server logs - revealed that OpenAI and its partners used Apple's confidential information while developing hardware. One example: a proprietary metal-finishing technique that OpenAI allegedly had a trusted Apple supplier perform, after misleading that partner into believing Apple had granted permission. Apple also says OpenAI approached a second longtime supplier working on power and battery manufacturing, using insider terminology to ask targeted questions about specific Apple components. On the personnel side, Apple alleges Chang Liu, an eight-year Apple senior systems electrical engineer who left for OpenAI in 2026, failed to return an Apple-issued laptop and used it to download confidential technical documents - specifications, engineering presentations, and proprietary project data on unannounced technologies - and shared Apple confidential information with other Apple employees applying to OpenAI. Apple seeks to bar OpenAI from using or disclosing its trade secrets, compel return of confidential materials, and preserve evidence, plus damages.
Context and counter-position
OpenAI's initial response was brief: it has no interest in other companies' trade secrets and remains focused on building technology that empowers people. It later said it had seen no evidence supporting the claims, and in August published a detailed rebuttal defending former Apple executive Tang Tan - a 24-year Apple veteran - saying he was consistently clear the team must not use confidential information from other companies, and that OpenAI wished Apple had raised the issues before filing. The suit follows reporting that OpenAI was itself preparing legal action against Apple over how the Siri-ChatGPT partnership played out, and arrives amid a thicket of litigation - including xAI's separate trade-secret suit against OpenAI - as OpenAI approaches a historic IPO.
The practical lessons for your business
- Discovery is the real weapon here. Apple explicitly notes that litigation lets it learn the extent of the alleged operation. If you are in a dispute where facts sit inside a counterparty, the filing itself is an information strategy - and conversely, assume anything in your systems is discoverable.
- Tighten the offboarding controls this case turns on: device return enforced as a hard gate, immediate credential revocation, egress monitoring in the notice period, and documented exit acknowledgements. An unreturned laptop is the single most common vector in trade-secret cases and the easiest to eliminate.
- Extend confidentiality obligations to your supply chain. Apple's most serious allegation involves a shared supplier being misled into applying a proprietary process. Contractual controls that bind suppliers to verify authorisation before applying customer-specific techniques are cheap insurance against exactly this.
- Strategic read for anyone with a frenemy partnership: Apple and OpenAI were commercially integrated while this investigation ran. Structure partnerships assuming today's partner may be tomorrow's competitor - segregate data, limit personnel overlap, and write IP boundaries that survive the relationship souring.