'LOL ... so funny': Apple says ex-engineer stole secrets and coached a colleague to do the same. He now works at OpenAI

Apple sued (1) a former engineer and OpenAI on July 10, alleging the engineer kept a way into Apple’s most sensitive files after he left — and used it. Chang Liu, a senior system electrical engineer for eight years, defected to OpenAI in January. Within weeks, Apple says, he discovered a security bug let him still reach the company’s confidential hardware files, and rather than report it, he exploited it and coached a colleague still inside Apple on how to copy materials without tripping the security team. The complaint names Liu, former Apple vice president Tang Tan, OpenAI, and its hardware subsidiary io Products.

None of this has been proven. A complaint only tells the filing party’s side, and the defendants have not answered in court. Neither Liu nor Tan has commented. What the filing does offer is a detailed, message-by-message account of what Apple says happened.

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What Apple says Liu did

Liu left Apple on January 22, 2026, and never returned at least one company laptop — the same machine, Apple says, he had used to log into its network. Weeks later, Apple alleges, he found he could still reach its internal network storage, a cloud repository of confidential engineering files, through an authentication bug that should have locked him out.

He did not report it. Instead, Apple alleges, he messaged a former colleague still at Apple, Yu-Ting “Alyssa” Peng: “LOL, I found out I can access the [network storage], so funny.” Her reply, per the complaint, was “I’m ready.”

Apple says that while Liu was building hardware for OpenAI, he downloaded dozens of confidential files. Among them was a compilation of technical materials running past a thousand pages, plus presentations on how Apple manufactures and tests its main logic boards. Apple also alleges he used Peng’s Apple-issued computer to get onto the network while she was still an employee and he was not.

Liu also told Peng how to copy files from Apple workstations “to avoid trouble with the security team,” pointed her toward specific project folders, and told her which confidential materials to study before her own OpenAI interview. The two allegedly switched to the LINE messaging app to avoid detection. Peng later got an OpenAI offer and left Apple on April 16, 2026.

Apple’s case against OpenAI’s hardware chief

Apple treats Liu’s conduct as a smaller piece of a larger campaign by OpenAI. “At every level, from members of its Technical Staff to its Chief Hardware Officer, and in coordination with business partners, OpenAI has been stealing Apple’s trade secrets and confidential information,” the company wrote in the filing. What it has laid out so far, the complaint says, is “the tip of the iceberg.”

Tang Tan, the other named individual, spent 24 years at Apple, working on the iPhone and Apple Watch before leaving in February 2024 to co-found io Products — the hardware startup OpenAI acquired in 2025 for roughly $6.5 billion, which is how Tan became OpenAI’s chief hardware officer. Apple says Tan used internal Apple codenames when interviewing candidates who still worked at Apple, and asked them to bring “actual parts” such as batteries and logic boards for “show and tell” sessions. The filing also claims he passed around an internal Apple “Need to Know” document covering the company’s departure security protocols, handing it to new OpenAI hires before they had given notice.

How the two companies got here

Two years ago, the two were partners. In 2024, Apple built OpenAI’s ChatGPT into the iPhone’s operating system, and OpenAI CEO Sam Altman attended the announcement at Apple’s headquarters.

OpenAI is building hardware, and it has no manufacturing history of its own. It bought its way into the device business in 2025, acquiring Jony Ive’s startup io Products for about $6.5 billion, and has since hired more than 400 former Apple employees. The materials named in the suit are the kind a company like that would need to get started: how Apple manufactures and tests its logic boards, a proprietary metal-finishing technique, the terminology it uses with suppliers.

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Things cooled once OpenAI pushed into hardware, and cooled further when Apple said this year that its rebuilt Siri would run on Google’s Gemini models instead of OpenAI’s. The suit also handed Elon Musk, an OpenAI co-founder-turned-rival, fresh ammunition in his ongoing feud with Sam Altman. Musk, who now runs the competing xAI, wasted no time needling Altman online.

Back in May, Bloomberg reported (2) that OpenAI was itself considering legal action against Apple, possibly over breach of contract, arguing Apple had not done enough to integrate or promote ChatGPT across its devices. Apple’s filing says that the integration agreement is not part of this case.

OpenAI has pushed back on the core of Apple’s claims. The day the suit was filed, its director of strategic communications, Drew Pusateri, posted (3): “We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.” That statement does not take on the specific allegations against Liu or Tan. Apple said it will “always defend our teams’ hard work and innovations” and is “taking all appropriate steps to do so.”

What the suit means for OpenAI’s IPO

The timing matters for OpenAI’s stock. OpenAI confirmed in June (4) that it had confidentially filed draft IPO paperwork, and reports point (5) to a listing that could value it above $1 trillion, though the company’s finance chief has signaled the timing may slip to late 2026 or 2027. OpenAI was last valued around $852 billion in a March funding round.

Trade-secret suits like this often grind on for years or settle quietly. But a confidential filing keeps the prospectus private until roughly 15 days (6) before the investor roadshow, and that public version is where audited financials and the full list of risk factors first appear. A live lawsuit over the exact hardware OpenAI is rushing to market belongs in that risk section, in front of everyday investors seeing the numbers for the first time.

OpenAI is not the only one heading for the public markets. It filed about a week after Anthropic filed confidentially at a reported $965 billion valuation, and both trail SpaceX, which went public in June.

Where the Apple-OpenAI lawsuit goes next

For now it all rests on claims that have not been tested in court. This is Apple’s version. None of the named individuals have filed a response. Semafor noted it’s likely Apple referred the matter to the FBI, as it has done in similar cases, though no referral has been confirmed.

Apple wants damages and court orders forcing OpenAI to stop using its information. With this much at stake for both sides, and with Apple promising that discovery will turn up more, the fight is going to play out in the open for a while.