Musk and OpenAI CEO Sam Altman cofounded OpenAI in 2015, but Musk left before the company became a technology star. Recently Musk, who went on to create his own AI firm, xAI, in 2023, has tried to prevent the ChatGPT maker from transitioning to a for-profit model, culminating in the current court case. In order for OpenAI to secure the entire $40 billion of its current fundraising round, the company must complete its transition by the end of the year.
OpenAI asked the judge to stop Musk from any further attacks, as well as be “held responsible for the damage he has already caused.”
In response, Musk's legal team referred to a $97.4 billion unsolicited takeover bid earlier this year from a Musk-led consortium, which OpenAI rejected. “Had OpenAI's Board genuinely considered the bid as they were obligated to do they would have seen how serious it was. It's telling that having to pay fair market value for OpenAI's assets allegedly ‘interferes’ with their business plans,“ Musk's lawyer Marc Toberoff said in a statement provided to Reuters.
Musk's xAI last month acquired X in a deal that values the social media company at $33 billion and allows the value of his artificial intelligence firm to be shared with co-investors in X.
OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor.
At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race.
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