Elon Musk Sues OpenAI…Again
Elon Musk, the prominent American entrepreneur and head of Tesla and SpaceX, has reignited legal action against OpenAI, the artificial intelligence (AI) behemoth, and its co-founders, Sam Altman and Greg Brockman.
On 5 August, Musk refiled a lawsuit against OpenAI, alleging that the company, led by Sam Altman, deviated from its founding contract by favouring commercial interests over the public good.
This marks the second time this year that Musk has taken legal action against OpenAI, following the abrupt withdrawal of a similar lawsuit in June that was initially filed in March.
The original lawsuit challenged the relationship between OpenAI, the developer of ChatGPT, and Microsoft, while also criticising the company's shift away from its non-profit origins.
In the latest legal filing, Musk accuses Altman of intentionally misleading him, exploiting his humanitarian concerns about the existential risks posed by AI, and manipulating him into co-founding OpenAI under false pretenses.
Part of the lawsuit stated:
“OpenAI's focus shifted from its advertised charitable purpose – to benefit the public and protect humanity – to a vehicle for Altman and his partners' self-enrichment. This is most clearly evidenced in OpenAI's partnership with Microsoft and the proliferation of an opaque web of for-profit OpenAI affiliates, recently valued at a whopping $100 billion.”
Musk's withdrawal of the initial lawsuit without a clear explanation has been followed by the new claim that he was "betrayed" by Altman and his associates, highlighting the AI firm's apparent prioritisation of commercial interests.
Musk frames the conflict as a fundamental clash between altruism and greed.
The lawsuit added:
“Altman and his long-time associate Brockman assiduously manipulated Musk into co-founding their spurious non-profit venture, OpenAI, Inc., by promising that it would chart a safer, more open course than profit-driven tech giants.”
The lawsuit also alleges that Altman and Brockman failed to honour their commitment to open-source OpenAI's technology, instead granting Microsoft an exclusive license.
The new suit, filed in federal court in Northern California, includes charges of racketeering and asserts that OpenAI breached its pledge to maintain its technology as open source.
Musk has stated that the purpose of the lawsuit is to "divest the defendants of their ill-gotten gains," reflecting his ongoing dispute with OpenAI and its leadership over the direction and ethos of the company.
The lawsuit stated:
“The idea that Altman sold Musk was that a non-profit, funded and backed by Musk, would attract world-class scientists, conduct leading AI research and development, and as a meaningful counterweight to Google's DeepMind in the race for Artificial General Intelligence (AGI).”
A Feud Spanning Six Years & Counting
Musk accused Altman and Brockman of steering OpenAI away from its initial charitable mission toward self-enrichment, particularly through a profitable partnership with Microsoft.
Last year, Microsoft obtained a non-voting board seat at OpenAI after Altman's temporary removal and subsequent reinstatement.
Musk claims that the AI firm's multibillion-dollar partnership with Microsoft violated the original founding contract.
However, Microsoft surrendered its observer seat in July due to intense regulatory scrutiny in various regions, including the United States.
The conflict, which began six years ago with the aforementioned partnership with Microsoft, has taken an intriguing turn today.
Musk co-founded OpenAI in 2015 and played a significant role in its early development through substantial funding, research direction, and the recruitment of leading AI experts.
In support of OpenAI's non-profit mission, Musk lent his name to the venture, invested considerable time, and provided tens of millions of dollars in seed capital, along with recruiting top AI scientists.
However, he stepped down from OpenAI's board of directors in 2018, later filing two lawsuits against the AI firm.
As OpenAI neared the development of a market-ready AI product, "Altman changed the narrative and proceeded to capitalise on the opportunity," according to the legal documents.
In a March 2024 blog post, OpenAI disclosed private emails suggesting that Musk was informed about OpenAI's shift to a for-profit model.
He even seemed to support the idea, arguing that only for-profit entities, like his own company Tesla, could compete with major technology giants like Google.
OpenAI had said:
“In early 2017, we came to the realization that building AGI will require vast quantities of compute. We and Elon recognized a for-profit entity would be necessary to acquire those resources.”
Pot Calling the Kettle Black: Musk to Expand His For-profit AI Startup xAI
As Musk's legal battle with OpenAI unfolds, his for-profit AI venture, xAI, has been accelerating its expansion plans.
Recent reports indicate that xAI is exploring the acquisition of another AI startup, Character AI, with the aim of bolstering its talent pool and refining its Grok chatbot.
Additionally, xAI has unveiled plans to construct a gigafactory for computing in Memphis, which could potentially house the world's largest supercomputer.
This ambitious project has already raised concerns among local residents regarding its energy consumption.
The situation presents an interesting juxtaposition: while Musk criticises OpenAI for its commercial pursuits, his own company, xAI, is making aggressive moves in the AI market.
This raises questions about Musk's motivations: Is his lawsuit against OpenAI driven by discontent over the company's success post-departure, or does he genuinely believe he has a strong case against his former colleagues, following the withdrawal of a similar lawsuit in June?
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