Apple Sues OpenAI and Ex-Employees Over Trade Secrets Theft
Apple Sues OpenAI, Ex-Employees for Alleged Trade Secrets Theft Amid AI Race
Apple’s Lawsuit Against OpenAI and Former Employees
Overview of the Legal Action
July 10 (Reuters) – Apple on Friday filed a lawsuit against OpenAI and two former employees, alleging misappropriation of the iPhone maker’s trade secrets to benefit the ChatGPT-owner’s foray into consumer hardware.
The complaint, filed in the U.S. District Court for the Northern District of California, alleges a coordinated effort to steal Apple’s confidential information, including product designs, manufacturing processes and supply chain strategies.
Defendants Named in the Lawsuit
The lawsuit is against former senior system electrical engineer of Apple Chang Liu and former vice president of product design for iPhone and Apple Watch Tang Yew Tan, as well as OpenAI Foundation, OpenAI Group PBC and io Products.
Escalating Tensions Between Apple and OpenAI
It dramatically escalates tension between Apple and the ChatGPT maker that has been simmering for months. OpenAI did not immediately respond to a Reuters request for comment.
Allegations of Trade Secret Theft
Chang Liu’s Alleged Actions
Apple alleged that Liu had failed to return a company-issued work laptop and later used an authentication bug to access Apple’s internal network, downloading “dozens of Apple’s confidential hardware-related files.”
Tang Yew Tan’s Alleged Actions
The company also claimed that Tan “has been methodically using Apple’s confidential information to benefit OpenAI” by emailing himself information about Apple suppliers and internal industry summaries before his departure.
OpenAI’s Response and Legal Countermeasures
A person familiar with the matter told Reuters in May that OpenAI was exploring legal options against Apple, including notifying the technology giant of a breach of contract but potentially not filing a full lawsuit.
Impact on the AI Industry and Company Relations
Intensified Competition for Talent and Technology
The tensions between the two tech companies have strained their relationship and shown how the race to develop AI products has intensified competition for talent and proprietary technology.
Apple and OpenAI Partnership Developments
Integration of Apple Intelligence and ChatGPT
In 2024, Apple announced integration of its “Apple Intelligence” technology across its apps including Siri and brought OpenAI’s chatbot ChatGPT to its devices.
Their partnership allows users to access ChatGPT results through Siri, while iPhone users can also sign up for ChatGPT memberships directly from the iOS settings menu.
OpenAI’s Acquisition of io Products
OpenAI bought hardware startup io Products, founded by former Apple designer Jony Ive, last year in a $6.5 billion deal, underscoring its push to move beyond software into consumer hardware. Ive is not named in the lawsuit.
Apple’s Siri Overhaul
Last month, Apple rolled out a long-delayed overhaul of Siri. The update comes two years after Apple first promised major upgrades that were repeatedly delayed.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Maju Samuel)
