OpenAI has countersued co-founder Elon Musk, accusing him of illegal and unfair ways to derail its restructuring plans and demanding a choose maintain him accountable for injury allegedly inflicted on the AI super-lab.
The sizable countersuit [PDF] and reply to Musk’s assertions was filed in California federal courtroom yesterday. Whereas it accuses the Tesla tycoon of a variety of habits supposed to undermine OpenAI’s operations, together with “harassment, interference, and misinformation,” the countersuit’s two claims for reduction zero in on Musk’s February try to purchase the ChatGPT maker for $97.375 billion. Whereas Musk’s crew has portrayed the provide as real, OpenAI’s legal professionals name it one thing else fully.
Reasonably than a severe acquisition bid, OpenAI claims Musk’s transfer was a “sham” designed “to intrude with OpenAI’s contemplated company restructuring.” Musk is now not concerned in OpenAI, and runs a rival synthetic intelligence outfit, xAI, amongst different companies.
“The letter included no proof of financing to pay the almost $100 billion buy value,” OpenAI stated in its countersuit submitting, including that not one of the buyers listed in Musk’s letter of intent had carried out any due diligence. One investor later admitted, per courtroom data, that Musk’s intent was to realize entry to OpenAI’s inside supplies by means of the authorized proceedings and “get behind the wall” on the Microsoft-backed tremendous lab.
“Though OpenAI acknowledged the bid as a feint, its mere existence – and the media firestorm surrounding it – required OpenAI to expend vital sources in responding to it,” the AI large stated.
It is that effort, and the so-called “sham bid,” that led OpenAI to accuse Musk of unfair and fraudulent enterprise practices, in addition to tortious interference with potential financial benefit (ie, when a 3rd get together disrupts a possible deal to the plaintiff’s detriment).
OpenAI is in search of injunctive reduction to cease Musk’s alleged interference and restitution for the sources it claims have been wasted responding to his bid.
We requested OpenAI what it hoped to attain, and it directed us to the courtroom submitting and to its feedback made on Musk’s X, the place the AI biz stated the countersuit was meant to place a cease to his “bad-faith ways to decelerate OpenAI and seize management of the main AI improvements for his private profit.”
[Musk] tried to grab management of OpenAI and merge it with Tesla as a for-profit – his personal emails show it. When he did not get his approach, he stormed off
“Elon’s by no means been concerning the mission. He is at all times had his personal agenda,” OpenAI continued. “He tried to grab management of OpenAI and merge it with Tesla as a for-profit – his personal emails show it. When he did not get his approach, he stormed off.”
The very temporary historical past of a billionaire feud
For many who’ve tried their greatest to disregard Musk and OpenAI chief Sam Altman’s feud, a little bit of historical past could also be needed.
Musk was certainly one of OpenAI’s co-founders, however he stormed off in 2018 following inside disagreements over management and strategic path. OpenAI alleges the SpaceX oligarch proposed merging OpenAI with Tesla (which has AI-powered self-driving targets) or sought full management, which the Altman outfit declined, resulting in his exit.
At one level, OpenAI’s management feared Musk would turn out to be a “dictator” of AGI, or highly effective synthetic normal intelligence, if he was allowed full management over the lab, judging from emails surfaced throughout this authorized battle.
“You acknowledged that you simply don’t wish to management the ultimate AGI, however throughout this negotiation, you’ve proven to us that absolute management is extraordinarily vital to you,” OpenAI co-founder and mega-boffin Ilya Sutskever wrote to Musk. “The purpose of OpenAI is to make the long run good and to keep away from an AGI dictatorship.”
In March 2024, Musk sued OpenAI and Altman alleging breach of contract, unfair enterprise practices, and fiduciary failures associated to OpenAI’s shut affiliation with Microsoft and the institution of a for-profit subsidiary. (OpenAI began out as a non-profit.)
Musk withdrew this lawsuit in June final yr with out offering a public cause, however filed a almost an identical one a pair months later. He claimed OpenAI’s shift towards a for-profit mannequin contradicted its authentic mission of creating AI for the advantage of humanity.
OpenAI’s authorized crew described Musk’s grievance as “lurch[ing] from concept to concept, distort[ing] its personal displays, and trad[ing] from begin to end on fact-free and infrequently advert hominem conclusions.”
OpenAI denies it is turning into a solely for-profit firm, claiming in its countersuit that its restructuring plan would solely see its for-profit subsidiary turn out to be a public profit company. That transfer is important, OpenAI asserted, to permit the outfit to higher compete for capital “in service of the mission to develop AGI for the advantage of humanity.” That stated, OpenAI continues to boost tens of billions of {dollars} in funding, $40 billion as not too long ago as late March.
An OpenAI spokesperson additional informed The Register it had no intention to desert its non-profit core.
“Our board has been very clear that we intend to strengthen the non-profit in order that it may ship on its mission for the long run,” OpenAI informed us. “We’re not promoting it, we’re doubling down on its work.”
OpenAI additionally pointed us to final week’s announcement of a fee comprising specialists in well being, science, training, and public companies to information the org’s deliberate evolution.
“We look ahead to the enter and recommendation from leaders who’ve expertise in community-based organizations on how we might help them obtain their missions,” OpenAI stated in an emailed assertion.
Nevertheless, OpenAI reportedly has to finish its transition to a for-profit entity by the top of 2025 to safe that aforementioned $40 billion in funding led by SoftBank.
Musk’s lawsuit is more likely to solely sluggish that down, particularly for the reason that trial, per a pretrial order this week, is not set to start till March 2026.
Neither Musk – famously now President Trump’s éminence grease – nor his authorized crew responded to questions for this story. ®
OpenAI has countersued co-founder Elon Musk, accusing him of illegal and unfair ways to derail its restructuring plans and demanding a choose maintain him accountable for injury allegedly inflicted on the AI super-lab.
The sizable countersuit [PDF] and reply to Musk’s assertions was filed in California federal courtroom yesterday. Whereas it accuses the Tesla tycoon of a variety of habits supposed to undermine OpenAI’s operations, together with “harassment, interference, and misinformation,” the countersuit’s two claims for reduction zero in on Musk’s February try to purchase the ChatGPT maker for $97.375 billion. Whereas Musk’s crew has portrayed the provide as real, OpenAI’s legal professionals name it one thing else fully.
Reasonably than a severe acquisition bid, OpenAI claims Musk’s transfer was a “sham” designed “to intrude with OpenAI’s contemplated company restructuring.” Musk is now not concerned in OpenAI, and runs a rival synthetic intelligence outfit, xAI, amongst different companies.
“The letter included no proof of financing to pay the almost $100 billion buy value,” OpenAI stated in its countersuit submitting, including that not one of the buyers listed in Musk’s letter of intent had carried out any due diligence. One investor later admitted, per courtroom data, that Musk’s intent was to realize entry to OpenAI’s inside supplies by means of the authorized proceedings and “get behind the wall” on the Microsoft-backed tremendous lab.
“Though OpenAI acknowledged the bid as a feint, its mere existence – and the media firestorm surrounding it – required OpenAI to expend vital sources in responding to it,” the AI large stated.
It is that effort, and the so-called “sham bid,” that led OpenAI to accuse Musk of unfair and fraudulent enterprise practices, in addition to tortious interference with potential financial benefit (ie, when a 3rd get together disrupts a possible deal to the plaintiff’s detriment).
OpenAI is in search of injunctive reduction to cease Musk’s alleged interference and restitution for the sources it claims have been wasted responding to his bid.
We requested OpenAI what it hoped to attain, and it directed us to the courtroom submitting and to its feedback made on Musk’s X, the place the AI biz stated the countersuit was meant to place a cease to his “bad-faith ways to decelerate OpenAI and seize management of the main AI improvements for his private profit.”
[Musk] tried to grab management of OpenAI and merge it with Tesla as a for-profit – his personal emails show it. When he did not get his approach, he stormed off
“Elon’s by no means been concerning the mission. He is at all times had his personal agenda,” OpenAI continued. “He tried to grab management of OpenAI and merge it with Tesla as a for-profit – his personal emails show it. When he did not get his approach, he stormed off.”
The very temporary historical past of a billionaire feud
For many who’ve tried their greatest to disregard Musk and OpenAI chief Sam Altman’s feud, a little bit of historical past could also be needed.
Musk was certainly one of OpenAI’s co-founders, however he stormed off in 2018 following inside disagreements over management and strategic path. OpenAI alleges the SpaceX oligarch proposed merging OpenAI with Tesla (which has AI-powered self-driving targets) or sought full management, which the Altman outfit declined, resulting in his exit.
At one level, OpenAI’s management feared Musk would turn out to be a “dictator” of AGI, or highly effective synthetic normal intelligence, if he was allowed full management over the lab, judging from emails surfaced throughout this authorized battle.
“You acknowledged that you simply don’t wish to management the ultimate AGI, however throughout this negotiation, you’ve proven to us that absolute management is extraordinarily vital to you,” OpenAI co-founder and mega-boffin Ilya Sutskever wrote to Musk. “The purpose of OpenAI is to make the long run good and to keep away from an AGI dictatorship.”
In March 2024, Musk sued OpenAI and Altman alleging breach of contract, unfair enterprise practices, and fiduciary failures associated to OpenAI’s shut affiliation with Microsoft and the institution of a for-profit subsidiary. (OpenAI began out as a non-profit.)
Musk withdrew this lawsuit in June final yr with out offering a public cause, however filed a almost an identical one a pair months later. He claimed OpenAI’s shift towards a for-profit mannequin contradicted its authentic mission of creating AI for the advantage of humanity.
OpenAI’s authorized crew described Musk’s grievance as “lurch[ing] from concept to concept, distort[ing] its personal displays, and trad[ing] from begin to end on fact-free and infrequently advert hominem conclusions.”
OpenAI denies it is turning into a solely for-profit firm, claiming in its countersuit that its restructuring plan would solely see its for-profit subsidiary turn out to be a public profit company. That transfer is important, OpenAI asserted, to permit the outfit to higher compete for capital “in service of the mission to develop AGI for the advantage of humanity.” That stated, OpenAI continues to boost tens of billions of {dollars} in funding, $40 billion as not too long ago as late March.
An OpenAI spokesperson additional informed The Register it had no intention to desert its non-profit core.
“Our board has been very clear that we intend to strengthen the non-profit in order that it may ship on its mission for the long run,” OpenAI informed us. “We’re not promoting it, we’re doubling down on its work.”
OpenAI additionally pointed us to final week’s announcement of a fee comprising specialists in well being, science, training, and public companies to information the org’s deliberate evolution.
“We look ahead to the enter and recommendation from leaders who’ve expertise in community-based organizations on how we might help them obtain their missions,” OpenAI stated in an emailed assertion.
Nevertheless, OpenAI reportedly has to finish its transition to a for-profit entity by the top of 2025 to safe that aforementioned $40 billion in funding led by SoftBank.
Musk’s lawsuit is more likely to solely sluggish that down, particularly for the reason that trial, per a pretrial order this week, is not set to start till March 2026.
Neither Musk – famously now President Trump’s éminence grease – nor his authorized crew responded to questions for this story. ®
