On Tuesday, Elon Musk appeared in court to testify in his lawsuit against OpenAI and its two co-founders, Sam Altman and Greg Brockman. He argued that the AI company's transformation from a public-benefit charity into a for-profit commercial entity was improper and sets a dangerous precedent for the operation of various non-profit organizations, raising widespread concerns. The trial commenced at the federal court in Oakland, California, where Musk directly addressed the jury in his opening remarks: "In my view, stealing from a charity cannot be tolerated."
This high-profile trial marks the culmination of years of accumulated grievances and public disputes among the three since they co-founded OpenAI in 2015. Subsequently, their relationship fractured, and they have become competitors. Musk emphasized that the implications of this lawsuit extend far beyond the parties involved. If Altman and Brockman's alleged misconduct is not legally condemned, the case could become a judicial precedent, encouraging the misappropriation of assets from charitable organizations across the United States.
OpenAI's attorney, William Savitt, countered Musk's claims in court, filing a motion with U.S. District Judge Yvonne Gonzalez Rogers to strike parts of Musk's testimony. Savitt argued that Musk, not being a practicing attorney, lacked the authority to provide qualified legal analysis. The judge ultimately denied this request. Savitt presented the defense's position to the jury, stating that the core purpose of Musk's lawsuit was actually to suppress the primary competitor of his own AI company, xAI. He also presented evidence suggesting that during OpenAI's early development, Musk himself had actively supported and advocated for its restructuring into a for-profit entity.
The outcome of this three-week trial could fundamentally reshape OpenAI's future trajectory. The AI giant is currently valued at nearly a trillion dollars, and its long-awaited IPO plan is highly anticipated, potentially setting a record for the largest initial public offering in global history. A central part of Musk's lawsuit involves a key request: for the court to overturn OpenAI's for-profit restructuring implemented last October.
During early questioning, Musk detailed his business history to the jury, including his involvement with Zip2, PayPal (PYPL.US), SpaceX, Neuralink, and Tesla (TSLA.US). He stated that he has long been engaged with AI development but consistently held reservations, worrying that AI intelligence and computational power surpassing humans could pose unknown risks. Musk cautioned the jury that AI is a double-edged sword: it can drive social progress, create immense value, and empower human development, but if it spirals out of control, it could also lead to catastrophic consequences. "AI could lead to universal prosperity, or it could lead to human extinction," he said.
Musk recalled that around 2015, he held extensive discussions with various figures about AI's potential and risks, including Alphabet (GOOG.US) co-founder Larry Page. He accused Page of being dismissive of AI safety concerns and brushing aside his extreme hypotheticals about AI causing human extinction. "Page stated that if AI continues to exist, human demise wouldn't matter," Musk added, "Simply because I value human existence and am concerned about humanity's fate, he labeled me a 'speciesist.'" Musk found this stance deeply absurd. At the time, Alphabet, with its ample funding, top-tier computing power, and talent, was the clear leader in the AI race, which solidified Musk's belief in the necessity of creating a counterbalance to Alphabet. "I was thinking, what model could serve as a hedge against Alphabet? The answer was an open-source, non-profit public-benefit organization." Alphabet is not involved in the current lawsuit and has not commented on the related disputes.
Musk's attorney, Steven Molot, presented the plaintiff's case: during OpenAI's startup phase, Altman and Brockman relied on Musk's financial investment, industry reputation, and strategic guidance to establish themselves, but later abandoned their public-benefit mission, altered the original founding principles, and used the platform's resources for personal gain. Molot further alleged that Microsoft (MSFT.US) was a knowing accomplice in this breach of trust. Starting the year after Musk left OpenAI's board, in 2019, Microsoft invested $13 billion in OpenAI, openly enabling the Altman team to disregard the organization's charitable mission, he claimed.
In response, OpenAI's lawyer Savitt referenced historical emails to rebut these points. He noted that during the organization's first year, while it was still a non-profit research lab, Musk had suggested in an email that "perhaps it's better to create a standard C-corp with a parallel non-profit." The following year, referencing the technical progress of Google's DeepMind, Musk again wrote that operating OpenAI purely as a non-profit might have been a mistake. In 2017, Musk and OpenAI's core team reached a consensus: the computational costs and hardware investments required for AI R&D far exceeded initial estimates, necessitating expanded funding channels. The founding team held dozens of intensive meetings, ultimately deciding on a restructuring plan that involved creating a for-profit subsidiary.
Savitt emphasized that during these multi-party negotiations in 2017, Musk never insisted on maintaining a purely non-profit structure; his stance was quite the opposite. "At that time, Musk wanted to fully commercialize OpenAI and sought absolute control of the company, but was met with collective opposition from the other founders, who refused to let one person solely control such a critical AI asset," Savitt stated.
Addressing these claims, Musk explained that he was not opposed to establishing a for-profit subsidiary, but insisted it must have a profit cap, with all earnings flowing back to the non-profit parent organization. The team had drafted an equity distribution plan at the time, proposing that the four core founders—Musk, Altman, Brockman, and Chief Scientist Ilya Sutskever—split the equity of the for-profit entity equally. Musk explicitly rejected this, deeming it unreasonable and unfair, as he had provided all the initial funding and believed he should hold a majority stake in the for-profit arm initially, with dilution occurring as other investors joined.
Currently, OpenAI's non-profit foundation still holds ultimate control over the group. As part of last year's transition to a for-profit structure, OpenAI stated it would continue to be overseen by its non-profit entity (now called the OpenAI Foundation). This non-profit entity also holds a 26% stake in the company. Microsoft holds a 27% stake. Microsoft's attorney, Russell Cohen, stated that the current dispute over equity and principles has little to do with Microsoft, asserting that the company has operated in full compliance, cooperated responsibly, and adhered to ethical standards. "Microsoft partnered with OpenAI to build a world-class non-profit research system. Unlike Musk's desire for control, Microsoft has always adhered to a philosophy of collaborative success, not seeking control but committed to building a mutually beneficial ecosystem," Cohen said.
In the subsequent stages of the trial, the jury is expected to hear testimony from several key industry witnesses and review years of emails, chat logs, and internal core documents from OpenAI's founding team. The jury's decision will be advisory and not directly binding. Judge Gonzalez Rogers will consider the jury's findings to ultimately rule on the validity of Musk's various legal claims and determine any subsequent corrective measures or compensation.
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