Apple is suing OpenAI for trade secret theft, accusing the artificial intelligence startup and its hardware chief of engaging in an organized campaign to steal information about Apple's unreleased products. The iPhone maker said in a lawsuit filed on Friday that OpenAI encouraged Apple employees to share information, parts, drawings and other materials related to unreleased products as part of the AI company's effort to develop its own line of devices.
Apple also named OpenAI chief hardware officer Tang Tan as a defendant in a lawsuit filed in the U.S. District Court for the Northern District of California. Tan previously served as Apple's vice president of product design, responsible for leading the development of iPhones, smartwatches, AirPods and many other products in the company's hardware engineering department.
The legal dispute marks a dramatic turn in the relationship between the two companies, which have worked closely together in recent years. ChatGPT chatbot developer OpenAI has been providing key technology for Apple’s Apple Intelligence platform and Siri digital assistant. But the relationship between the two parties has become increasingly tense over the past year; tensions further intensified after OpenAI hired former Apple design guru Jony Ive to help develop the device.
OpenAI is preparing for an initial public offering (IPO) in the coming months and has poached a large number of employees from Apple. According to the lawsuit, more than 400 former Apple employees currently work at OpenAI.
"OpenAI has been stealing Apple's trade secrets and confidential information at every level, from technical staff to chief hardware officer, and in coordination with business partners," the Cupertino, California-based technology giant said in the lawsuit. "The corollary is that OpenAI's fledgling hardware business is now built on an extremely fragile foundation, its foundation has been eroded by illegal reliance on misappropriated trade secrets."
Apple requires OpenAI to cease related practices and destroy any proprietary materials. Apple is demanding a jury trial and wants OpenAI to redesign unreleased products to ensure they do not contain any Apple technology.
OpenAI representatives did not immediately respond to a request for comment.
Apple said Tan encouraged employees during hiring interviews to provide information about unreleased products. The lawsuit also names former iPhone hardware engineer Chang Liu as a defendant, saying he provided relevant materials. Liu joined OpenAI in January.
Apple said that OpenAI "proactively guides" Apple employees on how to handle resignation matters.
The case highlights the importance of next-generation AI equipment to Silicon Valley. Apple, OpenAI, Meta Platforms Inc. and other companies are racing to develop new AI-centric hardware in an effort to prepare for the post-smartphone era.
Apple said it tried to resolve the dispute with OpenAI out of court several months ago, requiring it to cease related actions and destroy any proprietary material. Apple said it received no response and decided to sue.
"There is ample evidence that individuals employed by OpenAI improperly obtained Apple's secret and confidential information about unreleased technologies, processes and products," Apple said in a statement.