Elon Musk’s lawsuit against OpenAI, claiming the organization has strayed from its original mission, is set to go to trial on Monday, marking the start of jury selection in federal court in Oakland, California.
Musk was one of the co-founders of OpenAI back in 2015 but eventually left the group. He later started his own venture, xAI, in 2018. This move came after attempts to merge OpenAI with Tesla or to create a for-profit version that he could manage fell through, leaving him frustrated.
The crux of Musk’s lawsuit contends that OpenAI shifted to a for-profit model in 2019, countering its founding objective as a nonprofit aimed at developing artificial intelligence for the public good.
In his lawsuit, Musk is also seeking the dismissal of OpenAI’s CEO, Sam Altman, while requesting over $150 billion in damages from OpenAI and Microsoft, stating that this amount should be paid to the nonprofit’s fund. It’s worth noting that Altman was a co-founder alongside Musk.
OpenAI has responded to Musk’s allegations by stating that he had pushed for the merger before resigning from the board, hinting that Musk’s claims may be somewhat self-serving as he aims to boost his own startup in the competitive AI landscape.
In 2019, OpenAI transitioned to a model where a for-profit entity operated under its nonprofit umbrella. This allowed the organization to attract external funds critical for scaling its computing efforts and advancing AI research.
Musk’s legal team has calculated potential damages by estimating that a significant share—between 50% and 75%—of the nonprofit’s stock could be attributed to his initial contributions.
The lawsuit also emphasizes the unprecedented shift of a tax-exempt charity transforming into a massive for-profit entity within just eight years, which Musk argues raises legal and ethical issues.
OpenAI has accused Musk of being driven by personal vendetta and competitive anxieties. Despite their conflicts, both Musk and Altman expressed a willingness to proceed with the legal proceedings earlier this year.
As the trial approaches, the jury selection process is notably larger than typical civil cases, probably due to the high-profile nature of both Musk and Altman, making it harder to find an unbiased jury.
The judge has clarified that the jury’s role won’t involve ruling on the broader implications, but will focus on advising on potential financial penalties if OpenAI loses.
