OpenAI says secret device files crossed to Apple as IP fight turns two-way

The story

A trade-secret lawsuit that began with Apple accusing OpenAI of taking confidential hardware know-how has acquired a mirror-image allegation. OpenAI now says a former employee sent more than 100 highly confidential files about at least one unreleased OpenAI device to personal accounts before returning to Apple, then presented information about the product to senior Apple leadership. Apple says it has found no evidence supporting that claim. Both accounts remain allegations, and no court has found that either company misappropriated a trade secret.

The new claim appears in a filing in Apple Inc. v. Liu et al., case 5:26-cv-07078 in the U.S. District Court for the Northern District of California. Reuters reported that the files allegedly included information about an unreleased product and that OpenAI is concerned its confidential work could influence Apple’s coming devices. The Wall Street Journal and The Verge added that the materials allegedly covered engineering, manufacturing, suppliers, component sealing and cosmetic-finish standards. The employee is not named in the public reporting of OpenAI’s allegation.

Apple disputes the inference. According to an October 12 letter described by Reuters, the personal phone numbers OpenAI identified did not match the number the employee used for Apple work. Apple also said a search of work repositories associated with the employee had found no OpenAI files and that it had not learned of a presentation about an unreleased OpenAI product. Apple asked for more information and said it would continue investigating. That response does not resolve whether files moved, who controlled the receiving accounts or what was shown to executives.

The reversal matters because Apple brought the case on July 10. Its complaint alleges that former Apple engineer Chang Liu and former iPhone and Apple Watch design executive Tang Yew Tan took or used Apple confidential information to accelerate OpenAI’s consumer-hardware plans. OpenAI and io Products are also defendants. They deny wrongdoing. The case is brought under the federal Defend Trade Secrets Act and includes contract claims against the individual defendants.

On October 13, U.S. District Judge Edward Davila granted Apple part of its request for expedited discovery. The order permits targeted collection from certain former employees’ devices, depositions of Liu, Tan and another individual, and a corporate deposition of OpenAI and io on defined subjects. The judge rejected, narrowed or deferred other requests, including demands that depended on Apple’s initially broad definition of ‘Apple Originated Information.’ Apple must propose a more tailored definition before the court revisits those requests.

That balance is important. Expedited discovery is a procedure for preserving and testing evidence; it is not a finding that Apple’s allegations are true. The order says Apple raised concerns about data preservation and access, but it also limits discovery to avoid turning an early emergency process into the full merits case. OpenAI’s latest claim may now produce a second forensic inquiry moving in the opposite direction, and the company could seek permission to add counterclaims.

The technical subject is broader than a single design drawing. Consumer hardware depends on accumulated information about materials, power management, batteries, surface finishes, manufacturing tolerances and suppliers. Some of that knowledge may be patentable, but companies often keep it secret instead. Under U.S. law, trade-secret protection generally requires information that gains economic value from not being generally known and reasonable measures to preserve its secrecy. A claimant must also connect the defendant to improper acquisition, disclosure or use.

That makes chain of custody central. A file in a personal account may support an allegation against an individual, yet liability for a new employer requires evidence about what the employer knew and did. Similarity between two products is not enough by itself. Apple’s long product cycles also complicate any attempt to infer that a newly announced device resulted from material allegedly presented only months earlier. Timelines, access logs, message records and design histories should be more probative than competing public statements.

INNOVOX analysis: patents are public maps around an invention; trade secrets are guarded routes through the engineering process. In the AI-device race, the most valuable assets may be neither a model weight nor a granted patent, but the practical knowledge needed to turn an interface concept into manufacturable hardware. This case tests whether firms can recruit aggressively across a concentrated talent market while keeping those invisible boundaries intact. The two-way accusations also make clean-room development records and disciplined employee offboarding as strategically important as product design.

What to watch next is evidence, not rhetoric. OpenAI will need to identify the files, receiving accounts, presentation and alleged exposure inside Apple with enough specificity to support a counterclaim. Apple will seek to show what its former employees accessed and whether OpenAI used it. Device imaging and depositions ordered by the court should clarify both stories. Trial is currently expected in 2027, but an injunction motion or a negotiated protocol for quarantining disputed material could shape the companies’ hardware programs much sooner.

INNOVOX analysis

The dispute shows why know-how can be more strategically important than patents in fast-moving hardware. A patent discloses an invention in exchange for a limited monopoly; a trade secret can protect supplier choices, engineering tolerances and unfinished product plans only while secrecy is maintained. The decisive evidence will therefore be provenance and use: what the files contained, how they moved, who received them and whether either company used protected information rather than developing similar products independently.

What to watch

Watch for OpenAI counterclaims, Apple’s forensic response, completion of expedited device collection and depositions, and any injunction request tied to product development. The court must also decide whether the asserted information qualifies as a trade secret and whether acquisition, disclosure or use—not merely possession—can be proved.