Billionaire Elon Musk accuses OpenAI, the company’s CEO Sam Altman and President Greg Brockman of deceiving him and betraying OpenAI’s original non-profit mission. The case is being handled in a court in Oakland, California.
On the second day of testimony, on Wednesday (29), Elon Musk clashed with OpenAI’s lawyer during questioning, with lawyers on both sides focusing on the increasingly tense relationship between him and the organization that started the AI race.
when changing the corporate structure; OpenAI, in turn, claims that Musk’s lawsuit aims to harm the company’s position as a competitor to his own artificial intelligence company, xAI.
Musk’s lawyer presented previous messages between the billionaire and OpenAI leaders, including CEO Sam Altman, aimed at supporting claims that the ChatGPT creator deceived him. OpenAI’s lawyer, William Savitt, questioned Musk about his contributions to the company and whether the idea for OpenAI to seek profit came from him. The exchanges became tense at times, with Musk being asked by Savitt to stick to “yes” or “no” answers.
Musk testifies for the third consecutive time this Thursday (30). OpenAI’s lawyers will complete the interrogation, and then Musk’s lawyer will ask a second round of questions.
The trial comes as OpenAI plans what could be a strong IPO — and potentially a capital injection that could help the company cement its early lead in the global AI race.
“I was a fool,” says Musk
Much of the initial questioning on Wednesday focused on old internal emails between Musk and OpenAI executives, including Altman and President Greg Brockman, who were present in court, about possible plans to include a for-profit structure.
Musk said he would have no problem with a for-profit company “as long as it was a subsidiary of the nonprofit.”
“What we cannot allow is for the for-profit company to become the main focus, and that is what we have here,” he told the court.
Musk was asked about the instruction given to Jared Birchall, head of his family office, to register a for-profit public benefit corporation in 2017 in the name of OpenAI, claiming he did so “if necessary.”
In emails presented as evidence, Musk also stated that he needed to have control of the proposed company.
“I needed to make sure everything was done in the right direction and I was providing almost all the money,” he argued to the court.
When the other co-founders expressed concern about this structure, Musk told the court that he believed they had “failed to comply with what they had previously agreed to” and that “what they really wanted was to create a for-profit company where they had as much equity as possible.”
In another email submitted, Musk told the co-founders that he would “no longer fund OpenAI until they firmly commit to remaining a non-profit organization.”
“I was a fool,” he told the court. “I gave them free funding to create a startup,” he continued.
Microsoft’s involvement in OpenAI’s growth was also central to Musk’s complaint. In 2022, OpenAI announced a $10 billion investment from Microsoft, which valued the company, now with a for-profit subsidiary, at $20 billion. It was then, Musk told the court, that he “lost trust in Altman.”
In 2022, Musk sent Altman a link to an article about OpenAI’s evaluation, according to evidence presented to the court, and said he felt misled.
Altman’s response to Musk’s 2022 message was: “I agree this is bad. We offered equity when we set the profit cap, which you didn’t want at the time. We’re still very willing to do that when you want.”
Savitt tried to point out inconsistencies between Musk’s statements in court and those made on social network X, from whether Tesla was working on artificial general intelligence to how much he actually gave to OpenAI. Savitt also critically pressed Musk on whether he ever proposed that OpenAI create a for-profit division, pointing to emails and meeting minutes where Musk appeared to say that OpenAI needed a for-profit aspect to compete with Google.
Savitt’s line of questioning led to a particularly tense interaction between Musk, Savitt and U.S. District Court Judge Yvonne Gonzalez Rogers.
“Your questions are not simple. They are designed to trick me, essentially,” Musk said.
Legal battle over the future of AI
On the first day of testimony, with OpenAI CEO Sam Altman watching from the other side of the courtroom, . The company was designed to benefit all humanity, with open source that would make it the antithesis of companies created solely to benefit shareholders, according to him.
Musk claimed that the creation of OpenAI was born out of how the technology could be used to harm humans.
OpenAI’s chatbot, ChatGPT, has made the company a household name, with CEO Sam Altman among the world’s most famous technology leaders. Musk, the richest man in the world, is also a great technological leader.
The nine-person jury, selected Monday, will advise U.S. District Court Judge Yvonne Gonzalez Rogers as she decides whether to implement Musk’s requested measures, including OpenAI’s reversion to a nonprofit structure; the dismissal of Altman and OpenAI President Greg Brockman from the Board; and US$130 billion in compensation, which will go to OpenAI’s non-profit foundation.
Before testimony began on Tuesday (28), Rogers rebuked both sides for social media posts about the case.
“All of you try to control your propensity to use social media to make things worse outside of this courtroom,” she said.
