Apple and OpenAI are heading to court.

On Friday, July 10, Apple sued OpenAI, the artificial intelligence company led by CEO Sam Altman, and two former Apple employees, accusing the ChatGPT maker of obtaining confidential Apple information to help build its own consumer hardware.

The lawsuit names OpenAI’s commercial and nonprofit entities, its hardware company io Products, OpenAI Chief Hardware Officer Tang Yew Tan, and former Apple engineer Chang Liu. It was filed in the U.S. District Court for the Northern District of California.

“This case is about Apple’s former employees stealing Apple’s trade secrets for the benefit of OpenAI,” Apple said in the complaint.

The filing contains claims involving secret project names, confidential presentations, Apple-issued laptops, physical hardware components, supplier relationships, and even instructions for getting through an Apple exit interview. It also arrives as OpenAI prepares to release its first consumer device with former Apple design chief Jony Ive.

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There is a lot going on. Here are the 8 most important things to understand about the lawsuit, what Apple is actually alleging, and what could happen next.

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1. Apple is accusing OpenAI of more than simply hiring its employees

The first important distinction is that it is generally legal for one company to recruit employees from a competitor.

A former Apple engineer is allowed to accept a job at OpenAI. That engineer is also allowed to use general knowledge, professional experience, and skills developed over the course of a career. Apple does not own everything a person learned while working there.

A trade secret is different— it is valuable information that is not publicly known and that a company has taken reasonable steps to protect. That could include an unreleased product design, a private manufacturing process, a confidential list of suppliers, or technical specifications for a component that has not yet reached the market.

Apple alleges that OpenAI did not merely hire people with experience. It says OpenAI used those employees and its recruiting process to obtain protected documents, designs, physical parts, manufacturing knowledge, and information about unreleased products.

In plain language, Apple’s argument is essentially this: OpenAI was free to hire Apple engineers, but it was not free to ask them to bring Apple’s files and hardware along with them.

That remains Apple’s version of events. A complaint lays out what the plaintiff says happened; it is not a court ruling that those allegations are true. OpenAI’s Director of Strategic Communications Drew Pusateri has denied wanting or using Apple’s confidential information with a statement on X:

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2. The lawsuit is really about OpenAI becoming a hardware competitor

Apple and OpenAI were publicly working together only two years ago.

In 2024, Apple announced that ChatGPT would be integrated into Siri, Apple’s systemwide Writing Tools, and other Apple Intelligence features. The arrangement allowed users to send certain questions to ChatGPT directly from an iPhone, iPad, or Mac.

The relationship became more complicated when OpenAI moved beyond software and began developing its own consumer device.

In 2025, OpenAI acquired io Products, the hardware startup created by Ive, Tan, and several other former Apple employees, in a deal valued at roughly $6.5 billion. Ive, who helped design products including the iPhone, iMac, and Apple Watch during his time at Apple, is working with OpenAI on the device but is not personally named as a defendant in Apple’s lawsuit.

OpenAI has offered few concrete details about what it is making. The company has described the project as a new kind of AI device that would move beyond the familiar structure of screens, apps, keyboards, and smartphones. Its first hardware product is expected as soon as the end of 2026.

That context matters because Apple is not suing over information used to improve ChatGPT; rather, it alleges that its secrets were taken to help build physical products that could compete with Apple’s hardware business.

Apple says the information at issue covers product architecture, battery systems, circuit boards, component selection, manufacturing equipment, metal-finishing methods, supply-chain relationships, and unreleased product plans.

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3. Apple says OpenAI turned job interviews into information-gathering sessions

Some of the lawsuit’s most striking allegations involve how OpenAI interviewed Apple employees.

Tan spent more than 24 years at Apple and most recently served as vice president of product design for the iPhone and Apple Watch. He later helped found io and is now OpenAI’s chief hardware officer. Because he had worked on confidential Apple programs, Apple says he knew the company’s internal terminology, project names, suppliers, and development process.

According to the lawsuit, Tan used that knowledge while interviewing current Apple employees for jobs at OpenAI.

Apple alleges that he referred to at least one unreleased Apple project by its internal codename before asking a candidate about the company’s plans for it. To someone outside Apple, the name would have meant very little. To an employee working on the project, it would have signaled exactly what Tan wanted to discuss.

Candidates were also allegedly required to prepare “Technical Deep Dive” presentations about their work. Apple says the instructions asked for details including how components were selected, which vendors were used, what software supported system integration, and how engineers communicated with suppliers.

Those questions may sound like ordinary technical interview questions. Apple’s argument is that, when directed at current employees working on secret projects, they were asking candidates to disclose information that belonged to Apple.

The filing also alleges that Tan told candidates to bring “actual parts” from Apple to their interviews for “show and tell” sessions. Those parts allegedly included batteries, logic boards, systems-in-package, shields, and other physical components.

One candidate appeared surprised by the request, according to messages quoted in the filing, and said they “didn’t even know we could take those from the office.”

Apple says the interview process also generated evidence that now appears in the lawsuit. In one example, an employee allegedly began screenshotting and downloading files related to a highly confidential Apple project in the hours before an OpenAI interview. During the interview, Tan allegedly asked about that same project.

Apple says it found the activity by reviewing access records and server logs connected to its own systems. In other words, the candidate allegedly used an Apple computer to retrieve the files, leaving a record inside the systems from which the information was being taken.

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4. Apple says one former engineer kept a laptop and continued accessing its files

The lawsuit’s other central figure is Liu, who spent more than eight years at Apple as a senior system electrical engineer working on the iPhone before joining OpenAI in January 2026.

Apple alleges that Liu failed to return an Apple-issued laptop when he left the company. It also says he later discovered an authentication vulnerability that continued to give him access to Apple’s cloud-based file storage after his employment had ended.

According to the complaint, Liu did not report the apparent security problem. Apple says he instead used it to continue accessing confidential engineering materials while already employed by OpenAI.

The lawsuit alleges that Liu downloaded dozens of files containing technical specifications, engineering presentations, circuit-board information, and details about unannounced products. One compilation allegedly contained more than 1,000 pages of technical materials.

Apple also points to messages Liu allegedly sent after discovering that his access still worked. In one, he reportedly wrote to an Apple employee: “LOL, I found out I can access the [server], so funny.”

That detail is important because it could help Apple argue that the access was not accidental. Accidentally discovering that an old login still functions is one thing. Continuing to use it to download files after acknowledging the unexpected access is another.

Apple also alleges that Liu helped another Apple employee prepare for an OpenAI interview. He allegedly directed her toward specific confidential folders, advised her about what information to review, and discussed how files could be copied without attracting the attention of Apple’s security team.

The complaint says Liu eventually encouraged the employee to stop communicating through Apple devices and move their conversation to LINE, a separate messaging app. The employee later joined OpenAI. Liu has not publicly responded to the allegations.

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5. Apple says recruits were coached on how to avoid its exit-security procedures

When an employee leaves a company like Apple, the departure involves more than returning a badge and laptop.

The company may disable system access, examine recent downloads, recover devices, remind the employee of confidentiality agreements, and ask questions about where the person is going next. These procedures are designed to make sure confidential materials do not leave with the employee.

Apple alleges that OpenAI knew how those procedures worked and coached recruits on how to navigate or avoid them.

According to the filing, Tan circulated an internal Apple document marked “Need to Know” that explained Apple’s security process for departing employees. Apple says the document was intended only for certain Apple managers but was shared with recruits before they had even told Apple they were leaving.

That would mean the recruits allegedly knew in advance what Apple’s security team might inspect, what questions might be asked, and when their access could be cut off.

Apple also claims OpenAI advised departing employees not to disclose that they had accepted jobs with the company. Recruits were allegedly told not to sign documents during Apple exit interviews and to contact OpenAI immediately if Apple asked them to sign anything.

The lawsuit says Apple found a pattern among employees leaving for OpenAI: some skipped exit interviews, ignored messages from Apple’s security team, provided little or no notice, or otherwise avoided the usual departure process.

Apple is using those examples to argue that the alleged conduct was coordinated rather than the work of one person independently deciding to take files.

OpenAI now employs more than 400 former Apple employees, according to the complaint. That number is not evidence of wrongdoing by itself. The significant question is whether any of those workers brought protected Apple information with them and whether OpenAI knowingly requested, received, or used it.

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6. Apple says OpenAI also went through its suppliers

Apple’s allegations extend beyond employees and interviews.

Modern hardware companies rely on complicated networks of suppliers that make batteries, chips, displays, enclosures, circuit boards, and manufacturing equipment. Apple also develops specialized processes with some of those partners that are not available to competitors.

The lawsuit alleges that OpenAI used information from former Apple employees to approach companies within that supply chain.

In one example, Apple says OpenAI asked a trusted manufacturing partner to demonstrate a proprietary metal-finishing technique. The technique allegedly involved a multi-step process developed by Apple to produce a particular appearance and physical finish on its devices.

Apple says the supplier was contractually prohibited from performing that work for other companies. OpenAI allegedly led the partner to believe that Apple had authorized the demonstration. According to Apple, it had not.

The complaint also says OpenAI approached a longtime Apple supplier involved in battery and power manufacturing. Former Apple employees allegedly used internal terminology to ask targeted questions about specific components and processes.

This part of the lawsuit could be particularly important because it moves the allegations beyond files sitting on an employee’s computer. Apple is claiming that confidential information was put to practical use while OpenAI was developing hardware.

OpenAI has not announced the design or component list for its device, so it is not publicly possible to determine whether any Apple technology appears in it. That is one reason Apple says it needs the lawsuit’s discovery process.

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7. Apple wants access to the evidence behind OpenAI’s device

Apple says it contacted OpenAI in February and asked the company to investigate its concerns. According to the lawsuit, OpenAI did not respond. Apple filed its complaint roughly five months later.

Apple is asking for damages, but money is only part of what it wants.

The company is also seeking an injunction, which is a court order requiring someone to do or stop doing something. Apple wants OpenAI barred from possessing, using, or disclosing its alleged trade secrets. It also wants confidential materials returned and evidence connected to the case preserved.

“Preserved” means the defendants could be required to retain relevant emails, messages, files, designs, access logs, and internal documents rather than deleting or changing them while the lawsuit moves forward.

Apple also expects to use discovery. Discovery is the part of a lawsuit in which each side can demand relevant evidence from the other. Depending on what a judge allows, Apple could seek internal OpenAI communications, recruiting records, design documents, supplier correspondence, and information showing how the company developed its device.

That does not automatically mean OpenAI will have to prove every component was developed independently before its product can launch. Apple would have to persuade the court that its evidence supports such restrictions, and OpenAI will have opportunities to challenge the allegations and the scope of Apple’s requests.

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Still, the timing is significant. OpenAI is moving toward its first hardware release, and Apple is asking a court to determine whether any part of that hardware operation depends on confidential Apple information.

Apple describes the conduct in sweeping terms, alleging that OpenAI’s hardware business is “rotten to its core” because of its supposed reliance on misappropriated trade secrets. OpenAI has denied that it wants another company’s secrets, and none of Apple’s claims has yet been proven in court.

Online, the immediate reaction treated the lawsuit like a particularly messy Silicon Valley breakup. Others focused on the employees at the center of Apple’s allegations, questioning how someone could spend decades helping build the company’s most important products and then (allegedly) carry confidential information into a rival operation.

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8. OpenAI is already fighting lawsuits on several fronts

Apple’s complaint arrives while OpenAI is dealing with legal challenges involving trade secrets, copyright, its corporate structure, and the safety of ChatGPT.

The closest comparison is a lawsuit Elon Musk’s xAI filed against OpenAI in September 2025, accusing the company of stealing confidential information after recruiting employees from the rival AI company. The case also focused partly on information disclosed during the hiring process.

A federal judge dismissed the original complaint on in February, but allowed xAI to revise its claims. The judge eventually dismissed the lawsuit with prejudice on June 15, finding that xAI had not shown OpenAI encouraged a former engineer to reveal trade secrets or that OpenAI employees knew he might have done so.

Musk separately sued OpenAI, CEO Sam Altman, and President Greg Brockman over claims that they had abandoned the organization’s original nonprofit mission. A federal jury ruled against Musk in May after finding that he waited too long to file the case. The verdict turned on the statute of limitations and did not decide whether OpenAI had actually violated its founding commitments. Musk says he plans to appeal.

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OpenAI is also facing a growing group of cases focused on the safety of ChatGPT.

Florida sued OpenAI and Altman on June 1, accusing the company of aggressively marketing ChatGPT to children while concealing serious risks and disregarding safety warnings. The state alleges that the chatbot facilitated harmful behavior, including self-harm and violence, and collected information from minors without meaningful parental consent. OpenAI has disputed the copyright allegations and has said it continues to strengthen safeguards involving minors, self-harm, and threats of violence.

The government of British Columbia also announced July 7 that it had retained lawyers in Canada and California to explore legal action against OpenAI following the February mass shooting at Tumbler Ridge Secondary School (the province has not yet filed its own lawsuit). It says internal OpenAI reports showed that the company’s safety teams flagged violent prompts connected to the shooter months before the attack but did not notify law enforcement. Families affected by the shooting have already filed separate cases against OpenAI in California.

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Meanwhile, The New York Times, the New York Daily News, authors, and other publishers are pursuing copyright cases that accuse OpenAI of improperly using protected material to train its AI models.

It’s clear OpenAI is actively trying to build the future. But, increasingly, it is also being asked to defend how it built it.