Apple seeks injunction against OpenAI over 400 ex-employee poaching

Apple asked a U.S. judge Monday to bar OpenAI and two former employees from using confidential hardware information, escalating a trade secrets fight over the ChatGPT owner's push into consumer devices.

"Apple will be irreparably harmed absent a preliminary injunction," Apple said in a filing in the U.S. District Court for the Northern District of California.

The motion targets Chang Liu, a former senior system electrical engineer, and Tang Yew Tan, Apple's former vice president of product design for iPhone and Apple Watch, both now at OpenAI. Apple also sought expedited discovery, including depositions of the two ex-employees, OpenAI staffer Yu-Ting Peng, and corporate representatives of OpenAI and io Products, its commercial arm.

The case sets up a battle over the control of future AI devices that may not rely on traditional apps or operating systems — devices that, if successful, would pull consumer attention away from Apple's best-selling iPhone. Analysts believe OpenAI is working on a phone or other device of its own.

OpenAI rejected the request in a blog post titled "Apple is getting this wrong," calling the injunction "based on false information and completely unnecessary because we do not have, nor want, any of their trade secrets."

The dispute traces to Apple's July 10 lawsuit accusing OpenAI of systematically poaching more than 400 former Apple employees across product design, display, antenna, supply chain, and hardware procurement — a chain that roughly mirrors a full hardware development team. Apple said OpenAI coached new hires on how to bypass exit security checks, including sharing an internal managers' document marked "Need to Know" that describes departure security procedures.

OpenAI's response challenged Apple's account of pre-suit contact. Apple had claimed it reached out in February, but OpenAI said Apple's outside lawyers emailed the wrong person after confusing two Asian last names, and that Apple later conceded a claimed discussion with OpenAI's general counsel never happened. Apple told OpenAI it was "resolving any issues," then filed suit five months later, OpenAI said.

Apple's iCloud Practices Draw Scrutiny

The case has drawn attention to Apple's own data-management practices. The Information reported that more than half a dozen former Apple employees said confidential documents shared during their tenure remained accessible in their personal iCloud accounts after they left, with some still receiving update notifications. Apple gives employees 2TB of company-funded iCloud storage and encourages merging it with personal plans, mixing work files with personal data. Apple said the behaviors in its complaint have nothing to do with files shared or stored on iCloud and that it will not sue former employees who accidentally retain internal files.

The dispute echoes Apple's earlier fight with Rivos, a chip startup founded in 2021 that poached more than 40 Apple employees. That case settled in 2024, but not before Rivos argued Apple's own negligence caused the leak. Meta acquired Rivos late last year for roughly $2 billion.

For OpenAI, the timing is delicate. The company is expected to launch AI hardware next year, including a phone aimed at changing how apps are distributed, and has built out hardware capability by hiring Jony Ive, acquiring io Products, and recruiting Tang Tan. Apple's request that OpenAI redesign unreleased hardware to remove any parts tied to Apple's confidential information could slow that timeline.

Apple shares and OpenAI's private valuation are not directly priced for the outcome, but the case raises the cost of talent mobility between the two companies. A preliminary injunction, if granted, would restrict OpenAI's access to the two named executives' knowledge while the case proceeds — a constraint that could ripple through its hardware development schedule.

This article is for informational purposes only and does not constitute investment advice.