OpenAI CEO Denies Commitment to Nonprofit Status in Musk Lawsuit

In nearly four hours of testimony in federal court, OpenAI CEO Sam Altman refuted claims that he had promised to maintain the company as a nonprofit organization. This occurred during a lawsuit initiated by Elon Musk, who co-founded OpenAI with Altman and Greg Brockman in 2015.

The lawsuit centers on Musk’s assertion that the founders failed to uphold a commitment to keep OpenAI focused on philanthropy, rather than pursuing commercial ventures. During his appearance in Oakland, California, Altman was clear that he had not agreed to any such commitments regarding the organization’s structure. Musk, who contributed around $38 million to OpenAI before resigning from its board in 2018, is alleging that those funds were used improperly for profit-making activities. OpenAI, along with Altman, Brockman, and Microsoft, are named as defendants in the case.

On the witness stand, Altman’s demeanor contrasted sharply with Musk’s earlier testimony. Musk had engaged in tense exchanges with OpenAI’s lawyer, while Altman maintained a composed presence throughout. He appeared somewhat anxious at the start of the cross-examination but soon settled into a more relaxed state.

In his statements, Altman touched upon sensitive issues, including a crisis the company faced in 2023 when he was briefly removed from his position. He expressed feeling blindsided by the decision and noted that the board had provided scant explanation, citing a lack of transparency from him. This period, he said, felt like watching something he had devoted years to building on the verge of collapse.

Regarding Musk’s exit from OpenAI, Altman described it as a positive change for some team members, suggesting that Musk’s leadership style was “demoralizing” for certain employees. He suggested that Musk might be more suited to managing a factory than a research lab.

Altman also addressed Musk’s various proposals, including a merger with Tesla. He argued that aligning with Tesla would negate OpenAI’s mission, explaining that without that purpose, Tesla would essentially function only as a car manufacturer. Altman voiced apprehensions about Musk’s desire to maintain control, mentioning Musk’s suggestion that leadership could eventually be handed down to his children.

During cross-examination, Musk’s attorney sought to undermine Altman’s credibility, referencing integrity issues mentioned by former colleagues, including ex-employees of Musk’s startup Loopto and a former OpenAI board member. When asked if he felt completely trustworthy, Altman first responded cautiously before confidently affirming, “Yes.”

Some in the tech community have characterized Altman’s behavior as troubling. For instance, there were concerns voiced by Aaron Swartz, a notable figure who passed away in 2013, who advised not to trust Altman entirely. Among Microsoft executives, there is a growing sentiment that while Microsoft has long supported Altman, the relationship is becoming strained. This concern comes in light of recent agreements that some believe might breach previous commitments.

Altman revealed that both Amazon and Nvidia have invested more in OpenAI than Microsoft, despite Microsoft being a defendant in the lawsuit. Specifically, SoftBank’s investment of $30 billion exceeds Microsoft’s $13 billion stake.

Earlier testimony from OpenAI’s board chairman Brett Taylor indicated that the board unanimously declined Musk’s offer to purchase the organization last year. Taylor described the financial difficulties of 2023 as “devastating,” expressing doubts about the organization’s survival without resolution.

The trial also heard insights from Zico Kolter, who is responsible for overseeing safety at OpenAI. He recounted occasions where he formally requested postponements of model releases and sought more information before approving advancements.