The case centers on two lesser-known OpenAI employees: Tang Yew Tan and Chang Liu. Apple alleges Tan and Liu engaged in “a pattern of theft” of its trade secrets, which are some of the “most valuable intellectual assets in all of American business.” Apple is suing them for two things: “Breach of Intellectual Property Agreement” and “Misappropriation of Trade Secrets in Violation of the Defend Trade Secrets Act.”

The most famous ex-Apple employee now at OpenAI, Jony Ive, is not named in the case, though his involvement is implied as the co-founder of io, an AI hardware startup OpenAI purchased in 2025 and that Apple is now suing as part of the case. Apple is also suing OpenAI as a whole.

OpenAI tells Fortune it has “no interest in other companies’ trade secrets,” and that it is still reviewing the lawsuit, so we don’t yet have its side of the story. “We remain focused on building innovative technology that empowers people everywhere,” OpenAI said.

OpenAI is working on an AI-powered device, about which the company has said almost nothing—besides CEO Sam Altman calling an early prototype “the coolest piece that the world will have ever seen,” in May 2025. Over a year later, the company has still not released concrete details, but the device will most likely compete with smartphones as the primary platform through which consumers access AI on-the-go, whether that’s through smart glasses, AI pins, or something else.

Apple partnered with OpenAI in late 2024 to offer ChatGPT within a revamped version of its Siri voice assistant, a capability which still exists today. Apple was struggling to quickly deploy its own high-caliber AI models at the time, so it leaned on OpenAI’s. But the partnership has gone downhill since then, most notably when Apple chose Google Gemini as its go-forward AI partner in January, and now with this blockbuster lawsuit.

‘LOL’: Stealing secrets with an accomplice

Chang Liu worked at Apple for eight years as a senior system electrical engineer, and joined OpenAI’s San Francisco office in January 2026. Apple claims he failed to return at least one work-issued laptop and did not respond to requests for an exit interview or confirm he had returned all of his devices.

After he left, the lawsuit alleges that Liu kept in contact with Yu-Ting “Alyssa” Peng, who was still employed at Apple. About four months later, Peng also joined OpenAI. But before she left, Peng continued to have in-depth conversations with Liu about confidential Apple projects, Apple alleges. “Mr. Liu’s work for OpenAI was informed by a steadily flowing stream of Apple’s trade secret information from Ms. Peng,” the case says.

When Peng interviewed at OpenAI, Liu allegedly helped her prepare, instructing her to study specific proprietary Apple materials, knowing OpenAI would value the information and it was likely to get her a job offer. OpenAI did hire Peng, who Apple did not name as a defendant in the suit.

Before she left the company, Liu used Peng’s Apple-issued work computer to get into its corporate network, Apple contends. He also realized he could exploit a “rare, previously unknown authentication bug” to break into Apple’s network on the computer he failed to turn in, according to the suit.

“LOL, I found out I can access the [network storage], so funny,” Liu messaged Peng, according to the case. (If you’re an Apple employee reading this, let it be known the company really does read all your chats. It’s even busted former employees for communicating on Signal, SFGate reports.)

He then downloaded “dozens” of confidential hardware-related files, including “voluminous, detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data,” the lawsuit says. In one specific example detailed in Apple’s legal complaint, he downloaded a presentation about manufacturing and testing a certain type of circuit board in Apple’s hardware.

When Peng left Apple for OpenAI, Liu allegedly helped her copy files without tipping off the security team, and directed her to take specific files and data.

Sketchy interview tactics

Tang Yew Tan spent about a quarter century at Apple, including overseeing product design for the iPhone and Apple Watch. In March 2024 he left, and according to his LinkedIn he went to work a nondescript hardware startup, operating in stealth mode. This seems likely to be io, given in July 2025 he updated his role to Chief Hardware Officer at OpenAI, the same month io officially merged into OpenAI.

Once at OpenAI, he interviewed current Apple employees, mining them for information during the hiring process, doing things like intentionally using Apple project codenames to elicit as much information as possible, Apple’s lawsuit alleges. In total, Apple says OpenAI has hired about 400 ex-employees.

Tan’s tactics allegedly included asking Apple employees to bring in CAD designs and prototypes, and to divulge information on Apple’s suppliers. One Apple employee was surprised at the request, commenting that he “didn’t even know we could take those from the office,” the case says.

Tan coached new hires to not tell Apple they were leaving for OpenAI, “so they can stay at Apple as long as they can,” the case says. Before Tan left, Apple alleges that he obtained a document outlining security procedures for departing employees, and Apple believes his OpenAI recruits used this to “evade security processes intended to protect Apple’s confidential information.”

What’s OpenAI’s role in this?

While Apple makes highly-detailed allegations against Liu and Tan and backs them up with evidence such as messages sent on Apple-issued devices, its allegations against OpenAI as a whole are more broad.

Apple argues the sketchy, self-serving behavior exemplified by Tan and Liu mirrors “a coordinated pattern of misconduct at an institutional level.” It claims that “such misconduct is normalized and exemplified by leadership” at OpenAI. Apple claims to have evidence of such misconduct “across seniority levels, technical disciplines, and departments at OpenAI.”

The iPhone maker alleges that OpenAI has been contacting its supplier base, which Apple has “painstakingly developed” over the years, presumably in an effort to get them to make the same or similar components for OpenAI’s forthcoming AI hardware device.

The case says Tan emailed himself supplier information before leaving, and an unnamed person at OpenAI contacted an Apple supplier, asking them to “carry out a specific trade secret metal-finishing technique for OpenAI, misleading the partner to believe they had Apple’s permission to do so.”

Apple says it emailed OpenAI in February during the early stages of its investigation, asking what it was doing to prevent confidential information from passing between companies. Apple says that OpenAI never responded.

The filing is “the tip of the iceberg,” Apple says, given it only has access to information on its company-issued devices. It warns that the forthcoming “discovery [process] will expose that the misappropriation has ben occurring on a scale many times greater than the several instances described below.”

Apple enlisted one of the nation’s top law firms to represent it in the case, Weil, Gotshal & Manges, LLP. The firm has been involved in some of the most complex, high-stakes white-collar cases in history, including representing Enron during its collapse. Some analysts speculate this case could define the future of both OpenAI and Apple—and much of the tech industry along with them.

OpenAI’s legal department has no shortage of work. In May, company fended off a lawsuit from Elon Musk, which a jury dismissed. In June, the state of Florida sued OpenAI for failing to disclose that its product could be dangerous, especially for children, NPR reports. Then last week, a day before Apple filed its case, The New York Times‘ ramped up its copyright case against OpenAI, accusing the AI company of withholding evidence.