Apple and OpenAI are set for a pivotal hearing Wednesday in a high-stakes lawsuit accusing the artificial intelligence company of conspiring to steal proprietary details about upcoming products as it expands into consumer hardware, according to Bloomberg News‘ Madlin Mekelburg and Georgia Fearn. The case, filed in July in the U.S. District Court for the Northern District of California, names OpenAI, its hardware chief Tang Tan, and former Apple engineer Chang Liu. Apple alleges the defendants systematically extracted confidential information on product design, manufacturing processes, component technologies, testing methods, and the company’s supply chain from departing or interviewing employees. Cupertino claims OpenAI is using that material to accelerate its own entry into hardware. OpenAI has strongly denied the accusations. It contends the lawsuit is an attempt to deter talent from leaving Apple and that ordinary job interviews have been mischaracterized as misappropriation. In court filings, OpenAI stated it is developing a new family of AI-era devices and has “no need or desire for Apple’s trade secrets.” Bloomberg News has reported that OpenAI’s first consumer hardware product is expected to be a doughnut-shaped smart speaker priced above $300, positioned as a distinct AI-centric device. U.S. District Judge Edward Davila in San Jose will hear arguments on two motions. Apple seeks a preliminary injunction barring OpenAI from using any confidential information obtained from Apple and from further efforts to acquire such details while the case proceeds. Apple has claimed OpenAI used interviews with current and former employees to solicit proprietary information, including by directing candidates to bring prototypes and design materials for demonstrations. OpenAI, meanwhile, has moved to dismiss the suit entirely, arguing Apple has not identified specific trade secrets and has only pointed to broad categories of hardware information. OpenAI has further asserted that the dispute highlights weaknesses in Apple’s own security and offboarding practices. It has pointed to employees’ use of personal iCloud accounts for work materials, an authentication issue that allegedly left Liu with residual access after his departure, and continued technical questions from Apple staff after he left. OpenAI previously published some private messages between Liu and Apple employees on its website. Apple has countered that materials in Liu’s personal accounts are distinct from its core claims involving later unauthorized access to company network storage and downloads of confidential files. On Tuesday, Judge Davila ordered OpenAI to expedite production of certain documents related to the alleged use of trade secrets in its hardware development. The companies’ clash comes despite a roughly two-year partnership that integrated ChatGPT into Apple software, amid reports of hundreds of Apple employees joining OpenAI. The litigation has added uncertainty for OpenAI as it pursues a high valuation and public listing. Support MacDailyNews at no extra cost to you by using this link to shop at Amazon. The post Apple and OpenAI face off in court over alleged trade secret theft in AI hardware push appeared first on MacDailyNews. You're currently a free subscriber to MacDailyNews. For the full experience, upgrade your subscription.
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