Tech Startup Battles OpenAI And Jony Ive Over Alleged Stolen AI Ideas

iyO’s legal battle with OpenAI and Jony Ive has intensified with new allegations that a former executive disclosed trade secrets to a rival design team.

The AP reports that a California-based technology company iyO Inc. has started legal action against a former executive, adding a new twist to an ongoing legal feud with OpenAI and Apple designer Jony Ive. iyO Inc.  had already filed a trademark infringement lawsuit against OpenAI and Jony Ive for their hardware startup named “io.”

The company now accuses ex-executive Dan Sargent of leaking its unreleased product design through a confidential sketch, after his departure from the company and his meeting with “io” co-founder Tang Yew Tan, who has worked with Jony Ive for many years. The AP notes that Sargent, who joined Apple after his departure from iyO in December, did not provide any statement regarding the lawsuit.

“This is not an action we take lightly,” said iyO founder and CEO Jason Rugolo, as reported by the AP. “Our primary goal here is not to target a former employee, whom we considered a friend, but to hold accountable those whom we believe preyed on him from a position of power,” he added.

At the center of the legal drama is the race to build a new kind of AI interface—one that doesn’t require screens or voice assistants. Rugolo pitched his earbud-like “audio computer” in 2022 to both Altman’s Apollo Projects and Ive’s design firm, but both passed, as noted by the AP. What Rugolo didn’t know, he says, was that the pair had already started quietly working on their own AI device.

“I’m happy to compete on product, but calling it the same name, that part is just amazing to me,” Rugolo said, as reported by the AP.

The “io” name choice by OpenAI’s Altman received criticism from Rugolo, who called it “silly” and “disappointing,” because it references computer input/output, as reported by the AP. The court has allowed iyO to proceed with its case, because the judge found sufficient evidence to move forward, and a hearing is scheduled for fall.