OpenAI Fights to Toss Apple's Trade-Secret Theft Lawsuit
OpenAI has asked a US judge to toss Apple's trade-secret suit as 'meritless', while a battle over 400-plus poached engineers reveals how differently India guards its talent.
The News
OpenAI has asked a US federal judge to throw out Apple's trade-secret lawsuit, branding the case "meritless" and, in the words of its own motion, "rotten to its core". The dismissal request was filed on 6 August 2026 in the Northern District of California, roughly a month after Apple launched the suit in July.
Apple's complaint accuses OpenAI of running what it called a "months-long scheme to steal confidential information", allegedly harvesting details of unreleased products from job candidates and fresh recruits. The iPhone maker says more than 400 of its former staff now work at OpenAI, and singles out several by name.
Chief among them is Tang Yew Tan, now OpenAI's chief hardware officer, who spent 24 years at Apple as a product-design vice-president on the iPhone and Apple Watch before co-founding io Products with Jony Ive. That venture, io, merged with OpenAI in July 2025. Apple also names Chang Liu, a former iPhone engineer who joined OpenAI in January 2026 and is accused of accessing confidential hardware files, alongside Yu-Ting Peng and 11 further ex-employees flagged in a later investigation.
OpenAI counters that the complaint was "plainly filed without adequate investigation", and has published iMessage exchanges on its own website to rebut the claims. A hearing on Apple's preliminary-injunction request is set for 1 October 2026.
Why It Matters
The dispute is less about code than about people. The most valuable currency in frontier AI is not a dataset but the handful of engineers who know how to ship hardware and train large models, and both companies are fighting over who owns the knowledge inside those heads. The last time a talent war boiled over into a landmark courtroom fight, Waymo sued Uber in 2017 over self-driving secrets carried by engineer Anthony Levandowski, a case settled for roughly $245 million. Apple appears to be reaching for a similar playbook.
OpenAI's hardware ambitions sharpen the stakes. Its io tie-up with Jony Ive points squarely at a consumer device that could rival the iPhone, giving Apple every incentive to slow a competitor that has hired away its design bench. Whether a judge reads the facts as genuine theft or ordinary job-hopping will help set how aggressively big technology firms can wall off departing staff.
Indian Angle
For India, the case is a mirror held up to its own talent economy. Global capability centres in Bengaluru and Hyderabad now house the engineering teams of Apple and dozens of other multinationals, and the poaching that triggered this suit plays out weekly across Indian tech, where AI startups such as Sarvam and Krutrim compete with global labs for a thin pool of senior researchers.
The legal contrast, though, is sharp. India has no dedicated trade-secrets statute; protection rests on contract law and confidentiality agreements. Crucially, Section 27 of the Indian Contract Act, 1872 renders most post-employment non-compete clauses void, so an Indian employer trying to replicate Apple's action would have to lean on NDAs and breach-of-confidence claims rather than restraint of trade.
That gap matters as India's global capability centre count crosses 1,700 and iPhone assembly expands across Tamil Nadu and Karnataka. Indian founders and HR leaders watching this case should note how OpenAI frames routine recruiting as lawful and document retention as suspicious, because Indian courts weighing NDA disputes increasingly draw the same line.
FAQ
When will the case be decided?
Not soon. OpenAI's dismissal motion was filed on 6 August 2026, and a hearing on Apple's preliminary-injunction request is scheduled for 1 October 2026. Lawyers on both sides have signalled that the wider dispute could take years to resolve.
How many ex-Apple staff joined OpenAI?
Apple claims more than 400 of its former employees now work at OpenAI. Its complaint names a handful specifically, including hardware chief Tang Yew Tan and engineer Chang Liu, and points to 11 additional individuals flagged during a later internal investigation.
Could an Indian company file a similar suit?
It could, but on weaker footing. India lacks a standalone trade-secrets law, and Section 27 of the Contract Act voids most non-compete clauses. Employers instead rely on confidentiality agreements and breach-of-trust claims, which are harder to enforce than a US trade-secret action.
Where can I read the original coverage?
The Verge first reported OpenAI's dismissal motion and its "rotten to its core" language. The full link appears in the attribution below.
This story was reported by The Verge. Read the full original coverage at The Verge.