Apple’s trade secrets lawsuit against OpenAI is packed with a number of unusual allegations that paint a picture of a systematic effort to extract sensitive information from Apple’s current and former employees. But perhaps what’s most striking is how casually the alleged cheating is described, including the message, “Lol, I see you have access to (network storage), that’s pretty funny.”
The 41-page complaint filed Friday lays out these and other allegations in unusual detail. The ones that impressed us the most are:
“Normalized and modeled by leadership.” With this description of OpenAI, Apple is making clear that its lawsuit is not just focused on dishonest employees, but that such misconduct is part of OpenAI’s culture and is led by its upper management. “It’s rotten to the core.” Leave it to Apple to apply the rotten fruit analogy to criticism of OpenAI’s behavior in this case. The AI model maker is rumored to be developing a hardware device to rival the iPhone, potentially its own smartphone. But Apple wants to stress that what OpenAI is developing is allegedly built using Apple trade secrets. “OpenAI’s nascent hardware business is now built on the most unstable foundations, rotten to the core by its illegal reliance on misappropriated trade secrets,” the complaint states. “This is just the tip of the iceberg.” In addition to documenting the allegations against former employees, Apple has indicated that the allegations of misconduct outlined in the complaint are only a small portion of what will be revealed once the discovery process begins. Discovery will retrieve corporate documents and communications, including texts and emails, and may uncover other examples of this type of behavior at OpenAI. “This discovery will reveal that misappropriation occurs on a scale many times larger than some of the cases described below,” Apple’s complaint states. “Lol, I see you can access[network storage]that’s very interesting.” According to Apple, Chang Liu, who was a senior systems electrical engineer at Apple before joining OpenAI, sent this message to Yu-Ting “Alyssa” Peng, an Apple employee who was said to have been a conduit between Apple and OpenAI. Penn, who later left and joined OpenAI himself, is not a defendant in the lawsuit. Mr. Peng reportedly replied to the message, saying, “I’m ready.” Apple alleges that Liu was able to access Apple’s systems by exploiting an authentication bug, and did so from Peng’s Apple-issued work computer. “I still have another computer,” Liu allegedly texted this within hours of leaving Apple, referring to another Apple computer that he allegedly planned to use to access confidential Apple information. Apple discovered the messages on Mr. Peng’s Apple-issued work laptop. “I didn’t know you could take them out of the office.” One of the more outlandish allegations is that an OpenAI job applicant working at Apple was instructed by Tan Yew Tan, OpenAI’s chief hardware officer who worked at Apple for 24 years, most recently as vice president of product design for the iPhone and Apple Watch, to bring “real parts” from Apple to a “show-and-tell session” interview at OpenAI. Apple claims that one candidate was surprised by the request and said he didn’t even know that Apple parts could be taken out of the office. Apple also said employees were instructed to bring “CAD/design deliverables” and “prototypes” to interviews. Avoid the “terrible strike”. Apple claims that OpenAI taught departing Apple employees how to circumvent Apple’s security procedures to reduce their chances of being caught stealing trade secrets. The complaint alleges that OpenAI circulated an internal Apple document to new employees with a “must-know” document detailing how to avoid a “terrible strike.” A strike is when new employees are fired from Apple immediately after notice, without the usual two weeks of work, giving them more time to access confidential Apple information. If you are asked to sign anything when leaving Apple, “please let OpenAI know ‘as soon as possible’.” In addition to helping OpenAI job applicants circumvent Apple’s security procedures, the complaint alleges that if Apple asks departing employees to sign something during an exit interview, it should immediately notify OpenAI and advise them not to sign anything. “More than 400 former Apple employees now work for OpenAI.” Another surprise is that the complaint reveals the rate at which Apple employees leave the iPhone maker to work for OpenAI. Apple used this number to paint a picture of the potential scale of the problem, saying, “It is not surprising that certain OpenAI personnel knew Apple’s confidential and proprietary information and were obligated to keep it confidential. However, OpenAI engaged in the misuse of this confidential information…” and “io…accessed, misused, and used Apple’s secrets, proprietary industrial design techniques, processes, and know-how related to metal finishes.” Founded by former Apple employees including Jony Ive, Io was acquired by OpenAI last year in a $6.5 billion deal. The complaint names io as a defendant in the lawsuit because Apple alleges that io used its industrial design technology to mislead Apple partners into believing they had Apple’s permission to perform “confidential metal finishing technology.” Apple also claimed that OpenAI approached suppliers using confidential information about designs and components related to power supplies and batteries, and even used “internal terminology” to ask targeted questions that “only Apple insiders would know to ask.” “Apple has no choice.” At first glance, it seems like typical legal jargon, but in this case it seems like Apple may have tried to resolve the situation outside of court first. The tech giant said it first tried to contact OpenAI in February to raise its concerns, but OpenAI did not respond.
So far, OpenAI has only commented publicly through a statement shared with X on Friday, which reads: “We are not interested in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere.”
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