The removal stems from a trademark lawsuit filed by IYO Inc., an AI device maker that claims OpenAI's use of "io" creates consumer confusion with its registered "IYO" trademark12. IYO, a startup that spun out of Alphabet's X laboratory, argues that "io" is a "homophone" of its company name and has copied its business model of developing screenless AI-powered wearables23.

During a June 18 hearing in San Francisco, federal Judge Trina L. Thompson indicated she was open to IYO's argument that OpenAI's promotional video might already be creating consumer confusion, even though OpenAI has not yet released any "IO" products45. IYO claims its momentum "came to a screeching halt" following OpenAI's announcement6.

OpenAI announced in May that it would acquire Ive's design startup in an all-equity deal valued at $6.5 billion12. The acquisition brings Ive, who designed iconic Apple products including the iPhone and iPad, along with approximately 55 engineers and researchers to OpenAI2. Ive's separate design firm, LoveFrom, will continue operating independently while working with OpenAI2.

The deal represents OpenAI's largest acquisition and signals its push into consumer hardware beyond software applications1. The partnership aims to develop AI-powered devices that could compete directly with Apple in the hardware space, targeting a 2026 launch1.

Despite the legal complications, Bloomberg's Gurman reports that the acquisition "is on track and has NOT dissolved or anything of the sort"1. OpenAI fired back at IYO's legal challenge, calling the claims "purely hypothetical and thus insufficiently ripe" for court action2.

The trademark dispute highlights the competitive tensions in the emerging AI hardware market, where multiple companies are racing to develop the next generation of consumer devices that move beyond traditional screens and interfaces.