Apple presented a lawsuit against OpenAI and its hardware chief on Friday for allegedly stealing the iPhone maker’s trade secrets, including unreleased parts and prototypes, confidential designs and documents on secretive projects.

The lawsuit accuses OpenAI hardware director Tang Tan, who spent 24 years at Apple and oversaw iPhone product design, and his colleagues at the artificial intelligence company of encouraging people who leave or consider leaving Apple to bring with them proprietary and unreleased technology. Tan allegedly helped train recruits on how to evade Apple’s data security protocols and instructed them to bring confidential Apple parts to job interviews at OpenAI.

“OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to the core by its unlawful reliance on misappropriated trade secrets,” Apple says in the lawsuit, which was filed in U.S. District Court in San Jose. The company describes OpenAI as resorting to “taking illegal shortcuts” while under “increasing pressure to deliver its first commercial hardware product.”

“We have no interest in other companies’ trade secrets,” says OpenAI spokesperson Drew Pusateri. “We remain focused on creating innovative technology that empowers people around the world.”

Tan did not immediately respond to requests for comment.

Apple spokesperson Hannah Smith says the company “will always defend the hard work and innovations of our teams, and we are taking all appropriate steps to do so.”

The lawsuit opens what could become the most dramatic and high-stakes battle over intellectual property theft in Silicon Valley since autonomous transportation company Waymo in 2017 accused Uber of stealing hardware designs when it hired a former Waymo engineer who had walked away with thousands of confidential files. Uber agreed to pay $245 million to settle the lawsuit during the middle of a trial the following year.

Apple and OpenAI have been partners since 2024, when the companies announced a landmark agreement to distribute ChatGPT on iPhones, Macbooks, and iPads. But the relationship has frayed in recent years, leading Apple to rely more on Google’s Gemini AI technology as a foundation for the company’s internal AI models. OpenAI and Apple are expected to compete more fiercely in the coming years in the emerging market for AI-powered consumer devices.

OpenAI has hired more than 400 former Apple employees, according to the lawsuit. That includes several former Apple veterans leading OpenAI’s development of AI-powered consumer devices. Last year, OpenAI paid $6.5 billion to acquire a startup called io Products that was co-founded by former Apple executives including Tan, Scott Cannon, Evans Hankey and famed designer Jony Ive.

io Products and Chang Liu, an electrical engineer at OpenAI who was at Apple until January, are also defendants in the lawsuit. (Liu did not immediately respond to a request for comment.)

Apple’s investigation into the alleged theft is based on data and messages collected from its employees’ devices. The company became aware of the alleged theft earlier this year after Liu never returned his company-issued laptop and wrote to a former colleague about still having access to Apple’s internal file-sharing system, according to the lawsuit. (Apple says in the document that Liu’s access was made possible by a bug that has since been fixed.)

Liu “downloaded dozens of confidential files related to Apple hardware,” including a presentation on the manufacturing and testing of complex circuit boards used in Apple hardware, the lawsuit states. He adds that Liu also trained an Apple employee he was recruiting to join OpenAI on how to “‘avoid issues with the security team’ when copying sensitive Apple files.”

Apple wrote to OpenAI in February raising initial concerns about alleged theft, but received no response. That led to further investigation and the filing of the lawsuit.