OpenAI’s ambitions to create a hardware rival to the iPhone are already running into problems due to Apple’s trade secret lawsuit, according to BloombergMark Gurman, who says the damage manifests itself well before any court decision.
Apple sued OpenAI last week, accusing the company of pressuring former employees, and even people it was trying to recruit, to provide details about unreleased products. The suit also claims that OpenAI trained new hires on how to avoid Apple’s security checks during exit interviews using a document linked to former iPhone design chief Tang Tan. Apple is asking the court to order OpenAI to stop the alleged conduct, destroy any proprietary material obtained, and pay damages.
A legal resolution could take years, Gurman says, but he says the lawsuit is now doing damage, limiting OpenAI’s ability to recruit and creating a drag on its work on the devices long before a judge intervenes. OpenAI declined to directly discuss its hardware roadmap, although in response to the lawsuit the company said it had “no interest in other companies’ trade secrets” and remained focused on its own technology.
The scale of the talent drain is a big part of why this matters to Apple. More than 400 former Apple employees now work at OpenAI, including former Apple design chief Jony Ive, and Gurman says the company has hijacked Apple’s iPhone product design group so much that Apple has had to rebuild parts of the team. Apple responded with larger retention bonuses and executives working personally to keep engineers from leaving.
The trade secrets situation has apparently become one of Apple’s biggest internal concerns in recent months, along with tariff exposure and the ongoing memory chip shortage. In its own court filing, Apple frames the case as closely related to trade secrets and describes OpenAI’s hardware business as still nascent, arguing that the discovery is necessary to expose “the pervasive theft of Apple’s trade secrets.”
The lawsuit is said to already be reshaping OpenAI’s hiring, regardless of any final court ruling. Apple employees considering a move to OpenAI might now think twice given the increased scrutiny, and even an interview there could attract the attention of Apple’s security team, which could keep more engineers at Apple and slow the flow of institutional knowledge to OpenAI.
Former Apple employees are likely to become more cautious when discussing their past work, with managers avoiding technical questions that risk touching confidential Apple information. New legal reviews, tighter internal controls, and compliance training could push engineers away from actual development, while OpenAI’s top executives spend time on discovery and depositions.
Given Apple’s influence over Asian consumer electronics makers, suppliers may be reluctant to deepen their ties with OpenAI for fear of jeopardizing larger, older relationships with Apple or becoming embroiled in litigation themselves.
Bloomberg Intelligence wrote that “Apple is likely to get preliminary targeted relief related to OpenAI’s device efforts.” Such an order would likely require the disputed materials to be isolated, evidence-preserved, and certified compliant, which could further slow down OpenAI’s hardware plans. Longer term, if Apple can prove that its trade secrets have been integrated into OpenAI products, OpenAI may be forced to redesign them.
Regardless, a person familiar with OpenAI’s plans told Gurman that the company still plans to announce its first hardware product this year and launch it in 2027, although that could change as OpenAI examines Apple’s claims. This device would apparently be well advanced, but the construction of a larger family of products, of the type Bloomberg previously described as central to OpenAI’s device ambitions, will likely become more difficult. OpenAI is reportedly exploring categories including smart speakers and wearable devices with an iPhone-like device as the end goal, but a simpler, non-phone product is expected to ship first.
