Article on Apple and OpenAI escalate lega...

Apple and OpenAI's trade secrets dispute escalated this week when OpenAI asked a federal judge to dismiss the lawsuit Apple filed last month in San Jose, California. The iPhone maker accuses the ChatGPT creator of using former employees to steal confidential information for its own consumer hardware device.

In a filing Wednesday, OpenAI called the allegations "baseless" and requested a permanent dismissal, which would bar Apple from filing another lawsuit on the same grounds. Apple's complaint describes "repeated instances of deliberate theft."

"OpenAI should not be permitted to use Apple's secrets to gain an unjust head start in its hardware ambitions," the iPhone maker said.

OpenAI's lawyers responded sharply. "Apple built its reputation by paying close attention to the smallest details. This lawsuit does the opposite," they wrote, describing the complaint as "rotten to its core."

The dispute over talent

More than 400 former Apple employees currently work at OpenAI, according to the initial complaint. OpenAI's head of hardware, Tang Tan, is a former Apple vice president of design.

OpenAI argues the lawsuit is an attempt to punish normal employee mobility. "Apple should not be permitted to use a baseless and pretextual lawsuit to make up for its shortcomings in the market for talent and in retaining its employees, and its failures to integrate AI into its products," the company's lawyers wrote.

They cite California laws that encourage employees to change jobs, policies credited with driving the state's technology industry.

A partnership under strain

The legal fight comes despite a commercial relationship between the two companies. ChatGPT has been integrated into Apple products since 2024.

Apple's lawyers say the harm is ongoing. "The harm is happening now," they wrote, and "every day that passes without an injunction allows OpenAI to embed their knowledge of Apple's stolen information into its hardware development efforts."

What Apple alleges

To show urgency, Apple's lawyers submitted a TechCrunch article describing leaked details about OpenAI's first device: a screenless smart speaker designed with LoveFrom, the studio founded by former Apple design chief Jony Ive. Bloomberg reported Thursday the device would be circular, about the size of a hockey puck, cost between $300 and $400, and launch in 2027. OpenAI has not confirmed the leaks.

Apple alleges OpenAI asked job candidates to bring "prototypes" and design files to interviews for "show and tell" sessions. OpenAI said it follows standard industry practices, and that Tan "repeatedly instructed recruits and his team not to bring or disclose former employers' confidential information."

OpenAI also claims Apple failed to protect its own data, saying the Cupertino company "encouraged employees to use personal iCloud accounts for work, intermingling company and personal data, while failing to manage access cleanly across multiple Apple systems when employees departed."

"OpenAI has no use, need or desire for Apple's trade secrets," the company said, adding that Apple has not named any specific products that were allegedly copied. "OpenAI is building something entirely new and different."

The stakes

The case comes at a sensitive time for OpenAI, which is worth a reported $852 billion as it works toward a potential IPO. The company also faces competition from Anthropic, a rival AI lab founded by former OpenAI employees.

Federal Judge Edward Davila will consider both requests at a hearing Oct. 1.

Why this matters for legal professionals

This case tests how courts balance trade secret protection against California's strong public policy favoring employee mobility. OpenAI is leaning on that policy, while Apple argues the alleged conduct goes beyond ordinary job-hopping into deliberate theft. The outcome could shape how companies draft confidentiality agreements and handle departing employees in the AI sector, where talent moves frequently between competitors.

The case also illustrates that commercial partnerships and litigation can run in parallel. Apple and OpenAI remain business partners - ChatGPT is still integrated into Apple products - even as they fight in court. For lawyers advising tech companies, that dual relationship is worth watching: a dispute in one forum does not necessarily end cooperation in another.