Apple's Trade Secret Lawsuit Against OpenAI Over Chang Liu

Apple's newest court filing centers on a strikingly specific technical detail: forensic examiners recovered messages showing Chang Liu, an eight-year Apple senior systems electrical engineer who left for OpenAI in January 2026, downloading a confidential Apple power-converter circuit schematic and using it in his OpenAI work^[1]. Rather than just referencing the file, Liu described building an AI agent that 'learned how to run LTspice, look at result, tune compensation parameter' - automating the exact simulation workflow Apple uses internally to validate power-converter designs^[1]. That detail matters because it suggests the alleged theft was not a static copy of a drawing but an attempt to operationalize Apple's proprietary engineering methodology inside OpenAI's own hardware effort, which is exactly the kind of diffusion Apple's lawyers most want a judge to see as irreversible without an injunction.

Apple alleges Liu retained access to its internal network storage after his departure by exploiting a rare, previously unknown authentication bug rather than reporting it to Apple's security team^[2]. Messages cited in the filing show Liu joking about the discovery to a former Apple colleague: 'LOL, I found out I can access the [network storage], so funny'^[3]. The filing escalates further: once Liu learned Apple had opened an internal investigation into him, he allegedly sent instructions to an OpenAI colleague, identified as Yu-Ting Peng, to destroy evidence, and she confirmed compliance^[2]. That alleged sequence - discovery, joke, investigation, destruction - is what turned this from a garden-variety trade-secret dispute into an evidence-spoliation fight now anchoring Apple's push for an injunction and expedited discovery.

Apple's filing states that more than 400 former Apple employees now work at OpenAI, which Apple cites as evidence that 'it is not surprising that certain OpenAI personnel have knowledge of Apple's confidential and proprietary information'^[4]. Apple's original suit, filed in July 2026 against OpenAI, io Products, Liu, and fellow ex-Apple veteran Tang Yew Tan, frames this hiring pattern as part of a coordinated effort in which 'OpenAI encouraged Apple employees to share information, components, drawings and other materials related to upcoming products'^[5]. OpenAI has pushed back hard on that framing: its public rebuttal blog post, titled 'Apple is getting this wrong,' disputes Apple's timeline and even notes that Apple's own outside lawyers initially emailed the wrong person after confusing two Asian surnames^[6]. Separately, OpenAI has argued the dispute is, in its own words, 'a mess of Apple's own making,' pointing to Apple's security and offboarding practices as the real source of any lingering access^[7]. The scale of the alumni network is what turns one engineer's alleged misconduct into a company-wide liability question for OpenAI.

Apple filed a motion for a preliminary injunction in early August 2026 seeking to bar OpenAI, io Products, Liu, and Tan from acquiring, accessing, using, or disclosing its alleged trade secrets, paired with a motion for expedited discovery^[8]. That discovery request asks for substantive written-discovery responses within 30 days and an OpenAI corporate deposition within 50 days - far faster than a normal fact-discovery schedule^[9]. Both motions are set for a hearing before Judge Edward J. Davila in the Northern District of California on October 1, 2026, though the judge could rule before then^[9]. The compressed timeline reflects Apple's core legal argument: every day that passes lets OpenAI further embed allegedly stolen information into hardware still in development, making a later remedy harder to enforce even if Apple ultimately wins.

The dispute traces back to OpenAI's push into consumer hardware: in May 2025 OpenAI announced it would acquire io, the AI hardware startup co-founded by former Apple design chief Jony Ive, in a deal valued at roughly $6.4-6.5 billion^[10], which closed that July as OpenAI's largest acquisition to date^[11]. Tang Yew Tan, a 24-year Apple veteran who led iPhone and Apple Watch product design, is now OpenAI's chief hardware officer and a co-founder of io, and is named alongside Liu in Apple's suit^[1]. One tech analyst framed the stakes bluntly: 'This case underlines that the next phase of the AI battle will be fought in factories and living rooms, not just in data centers'^[12]. Beyond the specific allegations against Liu, the case is being watched as an early test of how trade-secret law applies to AI companies aggressively recruiting talent from established hardware makers, with implications for hiring practices across the industry.