AI

Apple Sues OpenAI

Alloy Newsletter:

Insights into the intersection of AI, Law, and Business.

"LOL, I found out I can access the [network storage], so funny."

That is a former Apple engineer, weeks into a new job at OpenAI, allegedly celebrating an authentication bug that left his access to Apple's confidential files after his departure from Apple. The reply from his contact still inside Apple: "I'm ready."

Both quotes come from the complaint filed Friday where Apple sued OpenAI, OpenAI's Chief Hardware Officer, and the engineer under the Defend Trade Secrets Act, 18 U.S.C. § 1836.

Trade secret cases are notoriously hard to litigate. You must prove the secret existed, prove you protected it, and prove a theft you rarely witnessed, all without disclosing the secret in a public filing. A company of Apple's scale does not file on inference. It files with smoking guns, and this complaint is full of them:

An unreturned laptop ("I still have another computer"). Dozens of confidential files downloaded while building OpenAI hardware. Coaching a colleague to "avoid trouble with the [Apple] security team." OpenAI's Chief Hardware Officer allegedly using Apple's internal codenames in interviews and telling candidates to bring "Actual parts" for "show and tell." An internal Apple "Need to Know" security document circulating among OpenAI recruits before they resign at Apple.

And Apple says this is the tip of the iceberg, pleading that discovery will expose misappropriation "on a scale many times greater"

Footnote 14 states that individual injunctions are being filed in the near term. Watch the docket!

Last point: nearly all of this evidence came from Apple's own devices and server logs. Offboarding forensics are litigation records, but many companies purge them within 30 days. Consider what records and logs you would like to have in future litigation when you are drafting your retention schedules.

Apple Inc. v. Liu, No. 5:26-cv-07078 (N.D. Cal.)

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