The Apple vs. OpenAI legal showdown

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**Meghan McCarty Carino** (1:04)
Oh look, another lawsuit for OpenAI. From American Public Media, this is Marketplace Tech. I'm Meghan McCarty Carino.
Apple has filed a lawsuit against OpenAI, alleging the AI startup stole trade secrets. We'll dig into it on today's Marketplace Tech Bytes Week in Review. Plus, New York State becomes the first to enact a data center moratorium, and Uber is lobbying to slow the role of autonomous vehicles in Washington, DC.
But first, back to that Apple lawsuit against OpenAI. The iPhone maker claimed that former Apple employees were asked to bring proprietary hardware to job interviews with OpenAI, and that the company tricked manufacturers into sharing Apple design secrets. Here to help us unpack all that is Paresh Dave, senior writer at Wired.

**Paresh Dave** (2:07)
Apple said there were some designs and presentations related to batteries, for example, or related to different processing circuit boards. But companies often try to claim things to be trade secrets that are not actually trade secrets. A company's definition versus an employee's definition versus another company's definition of what is actually proprietary guarded information can differ greatly, and how valuable this information actually was to OpenAI versus just OpenAI trying to see how important particular people were, as it was trying to recruit them and potentially hire them. There's a lot to be sorted in the actual value of the information.
Right.

**Meghan McCarty Carino** (2:49)
There's a long history in Silicon Valley of these kinds of recombination. Someone leaves one company, goes to another, they bring their knowledge with them. Where the line is on trade secrets can be fuzzy.
We know that last year, OpenAI acquired this industrial design firm headed by Johnny Ive, this legend of Apple design. We actually got some details about their first product launch this week.

**Paresh Dave** (3:24)
Yeah. Bloomberg reported that it's a device that is expected to sit on a tabletop but be battery operated, so it can move around some sort of smart speaker, no screen, and the essence is it's ChatGPT packed into this device. And supposedly, there will be sensors that including potentially a camera maybe that allows it to understand what's in the environment so it can better personalize content as it's responding to people's prompts.

**Meghan McCarty Carino** (3:55)
One of the sort of big questions that this lawsuit raises, I think, is, you know, is it possible to kind of claw back or disentangle anything that might have been a trade secret, you know, once they're already operationalizing that information?

**Paresh Dave** (4:11)
Yeah, that is, I mean, it's pure speculation here, but OpenAI's contention is that this device is very different from anything that Apple is developing. But yes, that's sort of the question. Like, this will at least slow down OpenAI in the sense that it's yet another lawsuit after the Elon Musk lawsuit that we talked about previously on the show that drags the company into legal holds and thinking about how to defend it and adds another sort of scar to this company that has struggled to maintain good relationships with some of its business partners.

**Meghan McCarty Carino** (4:45)
All right. Well, now we want to talk about the very first state-wide moratorium on data centers. This week, New York Governor Kathy Hochul signed an executive order barring hyperscale data center construction. So these are just the very large facilities, I think 50 megawatts or bigger, barring the construction of those facilities for a year. Here's what she said.

**Kathy Hochul** (5:09)
These data centers require millions of gallons of water straining the local supplies.
They occupy massive amounts of land, potentially displacing agricultural space and open spaces. The bottom line is progress shouldn't arrive with a higher utility bill, deleted water supply or noise pollution.