Apple's lawsuit could delay OpenAI's Jony Ive hardware dreams

Apple dropped a trade secrets lawsuit on OpenAI last Friday, and the allegations are about as serious as it gets in Silicon Valley. The complaint accuses OpenAI of a “pattern of misconduct” aimed at poaching Apple employees and, crucially, getting them to spill confidential information. Named directly in the suit is Tang Tan, Apple’s former chief hardware officer who now works at OpenAI. OpenAI says the complaint has no merit, but the damage might already be underway.

On the Equity podcast, we dug into what this means beyond the juicy legal drama. Sean O’Kane pointed out that even if a court never grants an injunction, a lawsuit of this nature is a natural delay mechanism. “It just naturally can lead to that sort of situation where it’s going to cause some delays in what OpenAI is working on, which I’m sure was probably part of the reasoning behind Apple doing this,” Sean said. “They don’t do this stuff willy nilly.” Apple rarely goes nuclear over talent moves, so the fact that they filed suggests they see a real threat to something tangible.

That tangible thing is almost certainly hardware. OpenAI has been famously cagey about its work with Jony Ive, but rumors have coalesced around a mobile smart speaker—the kind of always-listening device that makes people like me deeply uneasy. Even if you’re personally fine with Sam Altman’s voice in your pocket, I’m not, and neither are the random strangers whose conversations would get vacuumed up. Social norms around recording consent would need a complete overhaul if these things become common.

The timing could not be worse. OpenAI has confidentially filed to go public, with an IPO possibly landing late this year. While their software business is what will move the S-1, any hardware ambitions they’ve been pitching to bankers now carry a giant legal asterisk. The question is whether Altman’s team, fresh off beating Elon Musk in court, will stand and fight or write a check to make this go away before the roadshow begins.