When Your AI Partner Becomes Your Competitor
Apple is suing its former AI partner OpenAI for stealing hardware secrets, and the story is a warning for anyone whose business depends on an AI platform.
- 400+
- former Apple employees now at OpenAI
- $6.5B
- OpenAI's price to acquire io Products
- 41
- pages in Apple's court complaint
- 24 years
- Tang Tan's career at Apple before OpenAI
In 2024, Apple put ChatGPT inside the iPhone — a very public sign of partnership. Less than two years later, Apple filed a 41-page lawsuit in federal court accusing OpenAI of systematically stealing its hardware secrets. The relationship is now so broken that Apple is replacing ChatGPT with Google's Gemini in the next version of Siri.
The lawsuit names two former Apple engineers. Tang Tan, OpenAI's Chief Hardware Officer, spent 24 years at Apple designing the iPhone and Apple Watch. He allegedly told job candidates to bring actual Apple hardware parts to interviews for a 'show and tell.' Chang Liu, a former Apple electrical engineer, allegedly downloaded dozens of confidential files before leaving for OpenAI and coached other Apple employees on how to bypass security. Over 400 former Apple employees now work at OpenAI.
Behind the lawsuit is io Products, a hardware startup co-founded by Apple's famous former designer Jony Ive. OpenAI paid $6.5 billion to acquire it in May 2025. The goal is an AI-first device — something to replace the smartphone. That puts OpenAI in direct competition with the iPhone, which explains why Apple is now fighting back hard.
The lesson for anyone building on an AI platform: the company providing your tools today may become your biggest competitor tomorrow. Apple learned this the hard way with OpenAI. And for teams hiring from competitors, courts take 'bringing information from your last job' very seriously — the cost of a trade secret case is enormous even if you win. Know who holds the keys to the platform you depend on.