Apple Lawsuit Threatens OpenAI's Hardware Plans Despite Unchanged Timeline

OpenAI's hardware timeline remains unchanged for now, even as a new trade secret lawsuit from Apple threatens to disrupt its device ambitions, according to a Bloomberg report.

Apple has accused OpenAI and several former Apple employees of stealing confidential information to advance OpenAI's plans to build consumer hardware. The lawsuit alleges a "pattern of theft" by ex-Apple employees now working at OpenAI, with the company's leadership allegedly normalising such conduct.

Lawsuit Alleges Systematic Poaching

According to the report, Apple's lawsuit accuses OpenAI of running a campaign to poach Apple engineers and extract confidential, unreleased hardware blueprints. OpenAI is accused of targeting the tech giant's hardware design divisions and hiring more than 400 former Apple employees with large compensation packages.

The report said the resulting talent loss within Apple's iPhone product design team became severe enough that Apple had to rebuild parts of its engineering groups. In response, Apple executives have offered large retention bonuses and held personal meetings with senior engineers to prevent further departures to OpenAI.

OpenAI CEO Sam Altman has publicly responded to the lawsuit on social media platform X, stating that he is not afraid of Apple. However, the Bloomberg report said the litigation could still hurt OpenAI's hardware plans by affecting its recruitment efforts and increasing internal compliance requirements for its engineers.

By combining former Apple engineers with designer Jony Ive and its artificial intelligence capabilities, OpenAI had aimed to build what Altman described as a strong hardware competitor, the report said.

The report outlined three ways the lawsuit could affect OpenAI's plans, even before a court ruling. First, Apple employees considering a move to OpenAI may now face closer scrutiny from Apple's corporate security teams, which could slow OpenAI's hiring pipeline. Second, former Apple employees currently at OpenAI may become more cautious about sharing information due to concerns about legal exposure. Third, engineers may need to spend more time on compliance training and legal reviews instead of product development.

OpenAI had originally planned to announce its first consumer hardware product later this year, with a full commercial launch planned for 2027, the report added. That device, described as a simpler product such as a smart speaker or wearable gadget, is currently in an advanced stage of development, according to the report. The lawsuit, however, is expected to make it more difficult for OpenAI to pursue its broader hardware goals, as per the report.