Tech giant Apple sued ChatGPT-maker OpenAI on Friday, alleging the artificial intelligence company stole its trade secrets as part of efforts to build out a competing hardware business.

“This case is about Apple’s former employees stealing Apple’s trade secrets for the benefit of OpenAI. Apple brings this suit to put a stop to it,” Apple’s lawyers said in a complaint filed in federal court in the Northern District of California.

The complaint alleges that OpenAI leaders asked Apple employees to share information, including showcasing parts of new devices, during hiring interviews.

OpenAI’s head of hardware, former Apple vice president Tang Tan, is accused of directing a broad effort to steal Apple’s trade secrets and is also named in the complaint.

“We have no interest in other companies’ trade secrets. We remain focused on building innovative technology that empowers people everywhere,” said Drew Pusateri, a spokesperson for OpenAI.

The Washington Post has a content partnership with OpenAI.

The explosive allegations set up what is likely to become a titanic battle between one of the tech industry’s most powerful legacy companies and one of its fastest-growing up-and-comers.

The lawsuit could also weigh over OpenAI’s plans to go public at some point in the coming months amid fierce competition in the AI industry.

Apple, which ushered in the mobile internet era with its iPhones nearly 20 years ago, has struggled to adapt to the age of AI.

Just two years ago, Apple and OpenAI struck a deal for Apple to use OpenAI’s AI technology in its products, but little appeared to come from the collaboration.

In January, Apple said it would instead use Google’s Gemini AI technology in upcoming launches.

In the lawsuit, Apple says it began investigating OpenAI when it found an employee who had quit to go to the AI company did not return a company laptop.

The former employee, Chang Liu, used a “previously unknown” bug to use the computer to access Apple files when he had already begun working at OpenAI, Apple alleged.

“Mr. Liu surreptitiously accessed and downloaded dozens of Apple’s confidential hardware-related files, including voluminous, detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data,” Apple alleged.

The allegations against Tang, Liu and OpenAI echo those made in a blockbuster intellectual property theft case from 2017, when Google sued ride-share company Uber, alleging Anthony Levandowski, the founder of Google’s self-driving car program, downloaded schematics and files about the program before quitting, eventually joining Uber.

Google settled the civil case, but Levandowski was criminally charged for trade secrets theft and sentenced to 18 months in prison.

Uber abandoned its self-driving plans in 2020.

The lawsuit comes just two months after OpenAI won a major court battle against Tesla CEO Elon Musk, who sued the company alleging it betrayed its early commitments to develop AI to benefit all of humanity.

Though a judge and jury decisively sided with OpenAI, days of court testimony provided a platform for former OpenAI executives to question the trustworthiness of OpenAI CEO Sam Altman.

The Apple lawsuit does not explicitly say Altman managed the alleged trade secret theft, but it states that its allegations against Liu and Tang are “the tip of the iceberg.”

“Apple lacks visibility into what’s been happening behind closed doors at OpenAI, where such misconduct is normalized and exemplified by leadership,” the company’s lawyers wrote.

Altman has said on multiple occasions that he admires Apple and its late founder, Steve Jobs.

OpenAI has been working with former Apple chief designer Jony Ive to design new hardware devices specially tailored to the age of AI.

Ive is not mentioned in the complaint.

OpenAI is locked in a bitter competition for AI supremacy with Google, Claude-maker Anthropic and a rising host of other AI companies.

Devices could be a way for the company to differentiate itself and give consumers a reason to use OpenAI’s AI instead of a competitor’s.

But Apple, in its complaint, alleges that OpenAI’s hardware program is built on a foundation of theft.

“OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets,” the complaint states.