Last month, OpenAI made headlines when it announced a major hardware partnership with Jony Ive’s design company. The new project, called io, was introduced as a bold step toward creating AI-powered gadgets that blend into your daily life — like a device that’s “not a phone, not glasses,” but something entirely new.
But not long after, a much smaller company called iyO — pronounced the same as “io” — filed a lawsuit claiming that OpenAI and Ive’s company were infringing on their trademark.
What is iyO?
According to court documents filed in the U.S. District Court for the Northern District of California, iyO began in 2018 inside Google X (now known as X: The Moonshot Factory), Google’s research lab for futuristic tech. The team invested $25 million in its early research before spinning out into its own company in 2021. Since then, it’s raised another $37.2 million.
iyO’s flagship product is the iyO ONE — a screenless, voice-first wearable device that looks like an earbud but acts like a computer. It uses bone-conduction sound and advanced microphones to let users interact with AI and apps using only their voice. Think of it as a smartphone you can wear and talk to — but without the screen.
The company is in the middle of manufacturing its first 20,000 units, riding the momentum of pre-sales and a new funding round — or at least it was, until OpenAI announced io.
So what is trademark infringement, anyway?
In simple terms, a trademark is a word, name, logo, or design that helps people identify the source of a product or service. Think of names like “Nike” or “Spotify.” If someone else starts selling shoes under the name “Niky” or streaming music under “Spoteefy,” that’s likely a trademark issue — especially if it confuses customers.
Trademark infringement happens when:
A name or logo is too similar to an existing one
The products are similar enough that consumers might think they come from the same company
The original trademark owner can show they’ve been using the name first
iyO’s lawsuit accuses OpenAI and its partners — including Jony Ive and IO Products, Inc. — of willful trademark infringement and unfair competition, meaning that OpenAI, Jony Ive’s design studio LoveFrom, and even io’s co-founders knew about iyO as early as 2022.
What happens next?
iyO is asking the court for several things:
A permanent order to stop OpenAI from using the name “io”
Damages (money) for harm done to their brand
A ruling that OpenAI’s actions amounted to unfair competition
Meanwhile, OpenAI says it disagrees with the complaint and is “reviewing its options.” They could try to fight it in court, settle the case, or rebrand the device entirely.
For now, the $6.5 billion acquisition deal between OpenAI and Jony Ive’s company is still on. The hardware project is still moving forward — just not under the io name (at least for now).
Final thoughts
Trademark law is designed to protect both consumers and creators. For consumers, it ensures you’re not tricked into buying something you think is from one brand when it’s really from another. For businesses — especially startups like iyO — it provides legal tools to protect the identity and reputation they’ve worked hard to build.
In this case, OpenAI may have underestimated how important a name can be, legally speaking. Whether the company ends up changing the name or settling out of court, the lesson is clear: in tech, branding isn’t just a creative decision — it’s a legal one too.
