OpenAI asks a judge to throw out Apple's trade-secrets lawsuit, calling it "rotten to its core"

[OpenAI](#/company/openai) filed a 31-page motion on August 5 asking a federal judge to throw out [Apple](#/company/apple)'s trade-secret lawsuit before it reaches discovery, arguing the complaint "is — to borrow its own phrase — 'rotten to its core.'" The case, *Apple Inc. v. Liu*, was filed July 10 in the U.S. District Court for the Northern District of California and names four defendants: OpenAI Foundation, OpenAI Group PBC, OpenAI's hardware subsidiary io Products, and two individuals — Chang Liu and Tang Yew Tan, both former Apple hardware engineers now working on OpenAI's own hardware push.

What Apple's complaint alleges

Apple's suit centers on two named individuals rather than the company as a whole. Chang Liu spent eight years at Apple as a senior systems electrical engineer working on sensitive product-development programs before leaving in January 2026 to join OpenAI; Apple alleges he accessed confidential hardware files after discovering an authentication bug in an internal system, downloaded them, and instructed another employee on how to copy similar material. Tang Yew Tan, Apple's former chief hardware officer and now OpenAI's, is separately alleged to have emailed himself internal supplier information before he left, and to have asked job candidates in interviews to bring Apple parts or documentation with them.

OpenAI's motion leans hard on that last point: it says Apple's complaint uses the word "fail" — describing what Apple's own suit fails to do — nearly 50 times across its filing, and argues "Apple cannot transform the foreseeable consequences of its own systems and policies into evidence of theft." On the broader hiring pattern, the motion frames Apple's more-than-400-alumni count not as evidence of a scheme but as a symptom of a company Apple itself has struggled to keep pace with: OpenAI says it is "building something entirely new and different from anything at Apple," and has no reason to want Apple's designs.

The legal bar OpenAI is pointing at is specific. To win a trade-secret claim under the federal Defend Trade Secrets Act, Apple has to show three things: that the information was actually secret, that Apple took reasonable steps to keep it that way, and that a defendant acquired or used it improperly. OpenAI's motion attacks the first element directly — it argues Apple's complaint describes categories of information ("supplier data," "confidential hardware files") rather than the specific, identifiable secrets the statute requires, which is a common and often effective way to get a trade-secret case thrown out before discovery ever starts. Whether Apple's complaint clears that bar is now squarely the judge's call, not something either company's public statements can settle.

Why two hardware engineers, specifically

The lawsuit reads as much as a fight over Apple's talent pipeline as over any single document. Liu and Tan aren't Apple's only high-profile departures to [OpenAI](#/company/openai)'s hardware side — Jony Ive, Apple's former chief design officer, now works on the same product push through the io acquisition, though Apple's complaint does not name him as a defendant. Apple's own public response has stayed narrow and measured rather than escalating the rhetoric: the company said only that "protecting their work and intellectual property is something we take very seriously," and that it would "defend our teams' hard work." That restraint is notable next to OpenAI's much more combative filing, and it leaves the two sides currently arguing past each other — one describing ordinary hiring, the other describing an extraction scheme — rather than disputing the same set of facts.

The underlying tension is bigger than either named engineer. OpenAI's push into physical hardware through io Products depends on exactly the kind of design and manufacturing expertise Apple has spent decades concentrating in-house, and Apple is watching a competitor recruit directly against that advantage while it works to catch up on its own AI roadmap. Framed that way, the lawsuit reads as Apple trying to use trade-secret law to slow a talent drain it can't otherwise stop, and OpenAI's motion reads as an attempt to keep that fight out of a courtroom where discovery could expose exactly how io Products' hardware plans took shape. Neither company has said either of those things directly — both are litigating around narrower, individual conduct — but it is the strategic backdrop the specific allegations sit inside.

A motion to dismiss is a narrower legal move than it can sound like from the outside. It asks the judge to rule that Apple's complaint fails as a matter of law — that even if every factual allegation in it were true, it still wouldn't add up to a legally recognized trade-secret claim — not to weigh whether the underlying facts happened. If the judge denies the motion, the case moves into discovery, where both sides can compel documents and depositions and the actual authentication-bug access, the emailed supplier list, and the interview-room requests would get tested against evidence rather than argued from the complaint and the motion alone. If the judge grants it, at least in part, Apple would likely get a chance to refile with more specific allegations before the case is fully closed out.