Apple sued OpenAI for stealing trade secrets and the complaint is wild
On July 10, 2026, Apple filed a 41-page complaint in the Northern District of California against OpenAI, two former Apple employees, and io Products (the Jony Ive hardware startup OpenAI absorbed earlier this year). The claim: a coordinated campaign to steal Apple's hardware trade secrets. 847 upvotes on Hacker News in nine hours. 417 comments and climbing.
I read the complaint. It is not a vague "they took our know-how" suit. It reads like a prosecutor's memo. Specific people, specific files, specific messages left on company laptops. And the behavior it describes is brazen enough that I keep going back to re-read certain paragraphs because they sound like fiction.
The two people at the center
The complaint names two individual defendants. Chang Liu, a senior system electrical engineer who spent eight years at Apple working on the iPhone. And Tang Yew Tan, who spent 24 years at Apple, most recently as Vice President of Product Design for iPhone and Apple Watch. Tan is now OpenAI's Chief Hardware Officer.
These are not mid-level engineers who wandered off with a few documents. Tan was one of the most senior hardware people at one of the most secretive hardware companies on Earth. He co-founded io with Jony Ive. When OpenAI absorbed io, Tan went with it.
What Liu allegedly did
Here is where the complaint gets genuinely shocking.
Liu left Apple in January 2026 to join OpenAI. When Apple contacted him to do the standard exit procedures, return devices, sign confidentiality reminders, he did not respond.
Instead, according to Apple, he kept an Apple-issued laptop. One that was still authenticated to Apple's internal network. He then found a previously unknown authentication bug that gave him access to Apple's shared network folders. His reaction, left in a message on a former colleague's Apple laptop: "LOL" and "so funny."
Then, over several weeks, while developing hardware for OpenAI, he allegedly used that access to download dozens of confidential Apple files. Unreleased product specs, engineering presentations, technical specifications, proprietary project data.
He was also, according to the complaint, coaching a current Apple employee (whom he was recruiting to OpenAI) on how to "avoid trouble with the security team" when copying confidential files. He told her which Apple materials about unannounced products she should study before her OpenAI interview. And he directed her to communicate with him over a separate messaging app to hide the activity.
I want to sit with that for a second. This is not someone who casually forwarded a few emails to their personal account on the way out, which happens more than companies admit. This is someone who kept a company laptop, exploited a network bug, bragged about it in writing on a device that was being monitored, and then systematically downloaded secret files over a period of weeks. For their new employer.
What Tan allegedly did
The allegations against Tan are different in character but arguably worse because of his position.
Apple says that in the months before Tan left, he began emailing himself information about Apple's suppliers and internal summaries of the consumer electronics industry. After joining OpenAI as Chief Hardware Officer, he allegedly used Apple's confidential information in job interviews with current Apple employees.
The complaint describes him using an Apple internal project code name to ask a job candidate, "What's the plan?" about an unannounced product. He allegedly directed candidates still working at Apple to bring "actual parts" from Apple to their interviews for "show and tell" sessions. One candidate apparently commented that he "didn't even know we could take those from the office."
Apple claims OpenAI has been systematically instructing Apple employees to bring "CAD/design artifacts" and "prototypes" to interviews, and to divulge details about subsystem and component selection, CAD software, simulation tools, and vendor selection.
The complaint also describes something that is hard to read as anything other than deliberate: OpenAI allegedly approached an Apple supplier and had them carry out "a specific trade secret metal-finishing technique" for OpenAI's device, while misleading the supplier into believing Apple had given permission.
The security document
One detail that jumped out at me: Tan allegedly obtained or retained an internal Apple managers' document marked "Need to Know" that describes Apple's security procedures for employee departures. According to the complaint, Tan and his OpenAI colleagues have been sharing this document with new hires before they give notice to Apple, so they know exactly what Apple's security team will do and can plan around it.
If that is true, it means they were not just stealing product secrets. They were counter-operating against Apple's internal security process itself. That is a different level of coordination.
Apple tried writing to OpenAI first
A small but telling detail: Apple says it wrote to OpenAI in February 2026, while the investigation was still early. Apple asked OpenAI what precautions it was taking to avoid receiving Apple's confidential information, asked them to investigate, and asked them to remediate.
OpenAI never responded.
Six months of silence later, Apple filed a federal lawsuit with a jury demand. That tells you something about how seriously Apple takes this. Apple is notoriously reluctant to litigate publicly. They prefer to handle things quietly. The fact that they filed a complaint with this level of detail, in federal court, demanding a jury trial, means they concluded quiet resolution was not an option.
Why this matters beyond Apple and OpenAI
There are a few things that make this case worth paying attention to even if you do not care about Apple or OpenAI specifically.
First: the talent war between AI companies and hardware companies has been building for two years. AI companies need hardware expertise. Hardware engineers have that expertise locked inside NDA-protected walls. The temptation to bring knowledge along is enormous, and this case suggests at least one AI company was not just accepting that knowledge passively but actively encouraging its extraction.
Second: the complaint describes institutional behavior, not just individual wrongdoing. Apple is alleging that OpenAI's leadership, from the Chief Hardware Officer down to technical staff and business partners, acted in concert. If even half of this is true, it is not a few bad apples (no pun intended). It is a pattern.
Third: the io acquisition is central to this. Tan co-founded io with Jony Ive. OpenAI absorbed io. Now Apple is saying the io deal was, in part, a vehicle for funneling Apple's hardware secrets to OpenAI. That has implications for how we think about AI-hardware M&A going forward.
What happens next
This is a civil case, not criminal. Apple is seeking damages and injunctive relief. The discovery process will be the real show. Apple said in the complaint that it "lacks visibility into what's been happening behind closed doors at OpenAI" and that the lawsuit is partly a tool to force discovery.
If Apple gets broad discovery, and the internal communications at OpenAI match what the complaint describes, this could get very expensive very fast. Trade secret misappropriation under the Defend Trade Secrets Act can include punitive damages and attorney fees if the misappropriation is found to be willful and malicious.
OpenAI has not publicly commented on the suit as of this writing. They have a lot to answer for.
My read
Non-competes are generally gross. People should be able to change jobs and use their skills and experience. But what this complaint describes is not "I learned things at Apple and now I apply that knowledge elsewhere." It is "I kept my Apple laptop, exploited a bug to access Apple's network, downloaded secret files, told a recruit which confidential documents to study before her interview, and asked candidates to steal parts from their employer and bring them to me."
There is a line between carrying expertise in your head and carrying files in your bag. The complaint alleges people crossed it repeatedly, openly, and with institutional support. The "LOL so funny" message is the part I cannot stop thinking about. If you genuinely believe you are doing nothing wrong, you do not brazen about it on a monitored device. He knew. He just did not think anyone would catch him.
They caught him.