Trademark Infringement | Startup Protection | Corporate Strategy

In June 2025, Google-originated hardware startup iyO filed a trademark infringement lawsuit against OpenAI, Sam Altman, Jony Ive, and IO Products, alleging that the naming of OpenAI’s new consumer AI hardware venture—branded “io”—infringed its trademark rights. The lawsuit, bolstered by a temporary restraining order (TRO), has forced OpenAI to pull branding materials and delayed its official reveal, highlighting mounting legal tensions in the high-stakes AI hardware space.

Trademark Infringement & Startup Leverage

IYO asserts that its “iyO” mark, used for its AI-powered bone-conduction earbuds (iyO One), predates OpenAI’s use of the “io” name. The complaint—filed June 9—claims IYO shared confidential demos with Altman, Ive, and OpenAI personnel as far back as 2022 during acquisition and collaboration discussions (iphoneincanada.ca, ft.com). A U.S. District Court judge granted a TRO on June 20, prohibiting OpenAI from using “IO” in connection with any product marketing pending a formal hearing in October 2025 (milawyersweekly.com).

Corporate Response & public relations

OpenAI swiftly complied with the TRO, removing its blog post, promotional video, and all “io”-branded content from its website (autogpt.net). In public, Sam Altman criticized the lawsuit as “silly, disappointing and wrong,” asserting iyO only raised trademark concerns after OpenAI declined acquisition talks—accusing them of bad-faith tactics (cnbc.com). OpenAI emphasizes that the legal challenge doesn’t affect its $6.5 billion agreement with Jony Ive—the hardware venture continues under a new, yet-to-be-announced name (autogpt.net).

Implications for the AI Hardware Ecosystem

1. Startup Brand Protection in Focus
   IYO’s early success in court marks a victory for small innovators securing leverage against corporate giants. Their request for injunctive relief—and eventual trial set for January 2028—reflects the seriousness of brand dilution concerns (iphoneincanada.ca).
2. Naming Strategy & Legal Due Diligence
   As major players rush to brand futuristic AI devices, due diligence in trademark clearance becomes critical. Overlooked naming conflicts can derail strategic launches and incur reputational cost.
3. Public Legal Warfare
   Altman’s public statements and shared email threads reveal OpenAI’s strategy of influencing public opinion alongside legal defense. This dual strategy—legal filings backed by reputation management—suggests a broader trend where tech firms are navigating intellectual property not just in court, but in the court of public trust (reddit.com, milawyersweekly.com, theverge.com).

Conclusion

The iyO v. OpenAI dispute illustrates the complexity of product launches in the AI hardware arena, where innovation can collide with preexisting trademarks. With a TRO in place, an October hearing forthcoming, and a full trial scheduled for January 2028, this case stands as a high-profile test of how intellectual property law intersects with startup strategy and corporate scale in emerging product categories.

This case underscores three actionable learnings for the sector:

• Robust prior searches and naming clearance are essential.
• Early startup protections can influence the trajectory of major competitors.
• A cohesive legal and public-facing strategy is key when IP battles become high visibility.