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Home » Court filings reveal early work of Openai and IO on AI devices
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Court filings reveal early work of Openai and IO on AI devices

userBy userJune 23, 2025No Comments5 Mins Read
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A legal application filed earlier this month by lawyers representing Openai and Jony Ive’s IO reveals new details about the company’s efforts to build mass market AI hardware devices.

The filing is part of a trademark dispute lawsuit filed this month by IYO, a Google-backed hardware startup that develops custom molded earpieces that connect to other devices. Over the weekend, Openai plucked out promotional material related to Jony Ive’s $6.5 billion acquisition of IO startups in order to comply with court orders involved in the lawsuit. Openai says it is fighting allegations of Iyo’s trademark infringement.

Last year, Openai executives and former Apple leaders who currently work for IO are currently actively investigating in-ear hardware devices at IO, according to filings filed in IYO. In the June 12 application, lawyers representing Openai and IO said the companies have purchased at least 30 sets of headphones from a variety of companies to explore what is in the market today. In recent months, Openai and IO executives have also met with IYO leadership and demonstrated in-ear technology, according to emails revealed in the incident.

That said, the first device to collaborate with Openai’s IO may not be a pair of headphones.

Tang Tan, a longtime Apple executive who co-founded IO and co-founded the startup’s top hardware officer, claims that prototype Openai CEO Sam Altman, mentioned in the IO launch video, has declared to the court that he “is not an in-ear device, nor is it abrasive device.” Tan notes that the design of the prototype has not yet been finalized and that the product is at least a year away from being offered for advertising or sale.

The form factors for Openai and IO’s first hardware devices remain primarily a mystery. In the IO launch video, Altman simply stated that the startup was working to create a “family” of AI devices with a variety of features, and that the IO’s first prototype “watched it perfectly” his imagination.

According to the Wall Street Journal, Altman previously told Openai employees at the meeting that the company’s prototype could fit in his pocket or sit at a desk. Openai reportedly said the device will fully recognize the user’s surroundings and will become the “third device” that consumers will use alongside their smartphones and laptops.

“Our intention with this collaboration was to create products that go beyond traditional products and interfaces,” Altman said in a declaration to the court on June 12th.

In its filing, an attorney representing Openai said it investigated a wide range of devices, including “desktop-based mobile, wireless, wired, wearable and portable.”

Smart Glasses has emerged as the forefront of AI-enabled devices, with companies like Meta and Google Racing developing the pairs that were first widely adopted, while several companies are also exploring AI-enabled headphones. Apple is reportedly working on a pair of Airpods with cameras. This helps power AI functions by gathering information about the surrounding environment.

Over the past few months, Openai and IO executives have done considerable research into In-ear products.

On May 1st, Openai products, Peter Welinder and Tan met with IYO CEO Jason Rugolo to learn more about IYO’s In-ear products. The meeting took place at IO’s office in Jackson Square in the San Francisco area, where Ive bought several buildings to work on Lovefrom and IO.

At the meeting, Welinder and Tan tested Iyo’s custom fit Earpiece, but were disappointed when the product repeatedly failed during the demonstration.

In his declaration, Tan claims he met Lugoro as a courtesy of his mentor, longtime Apple executive Steve Zadesky. Tan also claims that his lawyers have taken some precautions to avoid learning too much about IYO’s IP, including suggesting that he review the material before him.

However, it appears that Openai and IO employees thought they could learn something from one of IYO’s partners. Iyo sent experts from Ear Project, an ear-stricken company, to someone’s home or office to get a detailed map of someone’s ears to customize their in-ear headsets.

In one email revealed in the incident, Marwan Rammah, a former Apple engineer who currently works at IO, told Tan that purchasing a large database of 3D scans from the EAR project could give the company a “helpful starting point for ergonomics.” It is unknown whether such a transaction was made.

Rugolo has repeatedly tried to build a deeper relationship between IYO, IO and Openai, but according to emails it has almost failed. He pitched Openai by launching IYO devices as the initial “developer kit” of the final AI device. He pitched Openai with an investment in IYO and at one point he even offered to sell his entire company for $200 million, the filing said. However, Tan said in his declaration that he had rejected these offers.

Former Apple executive Evans Hankey served as IO’s co-founder and chief product officer, and in his declaration to the court said IO was not working on “custom-molded earpiece products.”

It appears that ChatGpt makers have been more than a year since selling their first hardware devices. This may not be an in-ear product. Given what the company said in the lawsuit, it appears they are also investigating other form factors.


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