The legal battle between artificial intelligence powerhouse OpenAI and tech billionaire Elon Musk intensified Wednesday when the ChatGPT maker filed a countersuit against its former co-founder. OpenAI’s filing accuses Musk of engaging in a pattern of harassment and asks a federal judge to halt what it describes as “further unlawful and unfair action” against the company.
This latest legal maneuver comes amid a high-stakes dispute over OpenAI’s transition to a for-profit model, a move Musk has vehemently opposed since leaving the organization he helped create in 2015.
Once allies in the pursuit of developing artificial intelligence for humanity’s benefit, Musk and OpenAI CEO Sam Altman now find themselves on opposite sides of a contentious legal fight. Their falling out has significant implications for OpenAI’s future, as the company needs to complete its transition to a for-profit structure by year’s end to secure the entirety of its current $40 billion fundraising round.
“Through press attacks, malicious campaigns broadcast to Musk’s more than 200 million followers on the social media platform he controls, a pretextual demand for corporate records, harassing legal claims, and a sham bid for OpenAI’s assets, Musk has tried every tool available to harm OpenAI,” the company stated in its filing in U.S. District Court for the Northern District of California.
The countersuit goes beyond asking the judge to stop Musk’s alleged attacks, requesting that he be “held responsible for the damage he has already caused.” Both parties are scheduled to begin a jury trial in spring 2025.
At the heart of this dispute lies fundamentally different visions for how artificial intelligence should be developed and who should control it. Musk, who has since launched his own AI firm xAI in 2023, filed his initial lawsuit claiming that OpenAI had abandoned its founding mission of developing AI for the collective good in favor of corporate profits.
OpenAI and Altman have consistently denied these allegations, with Altman suggesting that Musk’s legal actions are merely attempts to impede a competitor in the increasingly competitive AI market.
In a public statement posted on X (formerly Twitter), the platform now owned by Musk, OpenAI didn’t mince words: “Elon’s nonstop actions against us are just bad-faith tactics to slow down OpenAI and seize control of the leading AI innovations for his personal benefit.”
Musk’s legal team pushed back against OpenAI’s allegations, pointing to a massive $97.4 billion unsolicited takeover bid earlier this year from a consortium led by Musk. “Had OpenAI’s Board genuinely considered the bid as they were obligated to do they would have seen how serious it was,” said Marc Toberoff, Musk’s lawyer, in a statement provided to Reuters.
“It’s telling that having to pay fair market value for OpenAI’s assets allegedly ‘interferes’ with their business plans,” Toberoff added, suggesting the company’s leadership is more concerned with maintaining control than doing what’s best for the organization.
While this legal battle unfolds, both Musk and OpenAI continue making strategic business moves. Last month, Musk’s xAI acquired X in a deal valuing the social media company at $33 billion. This arrangement allows the value of his artificial intelligence firm to be shared with co-investors in X, potentially strengthening Musk’s position in the AI sector.
Meanwhile, OpenAI faces pressure to complete its transition to a for-profit model before the end of the year to secure crucial funding. The company maintains this structural change is essential to raise the capital needed to compete effectively in the resource-intensive field of artificial intelligence development.
As the legal drama continues to unfold, the implications extend beyond just these two parties. The outcome could influence how artificial intelligence companies structure themselves, balance profit motives with ethical considerations, and determine who shapes the future of this transformative technology.
For now, the AI community watches as former collaborators wage a legal battle that will likely define not just their own futures, but potentially the direction of artificial intelligence development for years to come. With a jury trial set for spring next year, this high-profile dispute shows no signs of resolving quickly.
Musk did not respond to requests for comment on OpenAI’s latest filing.
