Apple has filed a federal lawsuit against OpenAI in Northern California, accusing the AI company of stealing trade secrets to develop its own consumer hardware. The lawsuit claims that OpenAI engaged in a coordinated effort “at every level” of its organization, involving technical staff, business partners, and the Chief Hardware Officer, to unlawfully obtain Apple’s intellectual property. This legal action marks a dramatic shift in the relationship between the two technology firms, who had formed a notable partnership in 2024 when ChatGPT was integrated into the iPhone ecosystem.

The dispute escalated after OpenAI announced its intention to enter the hardware market, following its $6.4 billion acquisition of IO Products, a startup founded by former Apple designer Jony Ive. Apple alleges that OpenAI’s hardware chief, Tang Tan, a former Apple VP, directed Apple employees interviewing at OpenAI to bring proprietary components for demonstration, a practice Apple claims was used to extract confidential information. Additional accusations involve former Apple employee Chang Liu, who is said to have stolen an Apple laptop during his transition to OpenAI, with both individuals named as defendants in the suit.

Apple also contends that OpenAI has misled hardware partners by having them adopt an Apple-invented metal finishing process without permission. The company believes that OpenAI has wrongfully accessed secret details about unreleased Apple technologies and products. In response, OpenAI stated it respects intellectual property and is committed to innovation, denying the allegations. Meanwhile, Apple’s updated Siri assistant is set to rely on Google’s Gemini AI, reflecting the cooling relationship between Apple and OpenAI.

The lawsuit seeks financial damages, injunctions to halt OpenAI’s use of those trade secrets, and could have repercussions for the companies’ existing collaboration, including ChatGPT’s integration within Apple devices. This legal challenge arrives amid other high-profile disputes faced by OpenAI, notably a recent trial with Elon Musk. As OpenAI prepares for what could be a landmark initial public offering, the case adds a significant layer of risk to the company’s path forward.