Lawyers Trade Barbs on Credibility of Elon Musk, Sam Altman in OpenAI Trial -- 3rd Update

Dow Jones05-15 04:22

By Georgia Wells

OAKLAND, Calif. -- Attorneys representing Elon Musk and OpenAI's Sam Altman traded barbs in closing arguments in a blockbuster trial Thursday, linking the outcome of the case to the credibility of the world's richest man and the leader of its most popular AI lab.

The statements close out the third week of the case, which is litigating the past -- and potentially the future -- of the AI revolution and has featured some of Silicon Valley's most prominent voices.

"Five witnesses in this trial called him a liar under oath," Musk's lawyer, Steven Molo, said of OpenAI's Altman. The comment was part of a lengthy effort to impugn his credibility and leadership of the startup, as well as highlight Musk's allegation that OpenAI acted deceptively when it converted from a nonprofit entity into a for-profit business.

Sarah Eddy, an attorney representing OpenAI, said Musk was aware of the plan to convert OpenAI from a nonprofit and soured on the idea when it was apparent that he would not be able to have full control of the entity.

She said Musk tried to convince jurors that he was duped, which wasn't credible because he is "one of the most sophisticated businessmen in the history of the world."

Altman defended himself and his leadership of OpenAI on Tuesday, disputing Musk's allegation that he and OpenAI had "stolen a charity" by converting a nonprofit entity that Musk supported financially into a for-profit venture.

"I'm very proud of the work that's been done," he said.

The trial, in an Oakland federal courtroom, has sought to untangle Musk's allegation that OpenAI and Altman manipulated him into thinking he was donating tens of millions of dollars to help launch a nonprofit to develop AI for the benefit of humanity, only to turn it into a for-profit venture.

Lawyers for OpenAI have denied wrongdoing. In court, they have argued that Musk not only knew about the plan to create a for-profit structure but that he also supported it and requested unilateral control of the venture. The OpenAI founders said no to his request, leading Musk to start his own AI company and now sue as a "strategy of harassment aimed at slowing us down," the company has alleged.

Legal experts have described Musk as an underdog in the case, but the remedies Musk is pushing for make the case significant for OpenAI and its executives. Musk is seeking the removal of Altman and OpenAI President Greg Brockman from their leadership roles and damages worth more than $180 billion to be paid into an OpenAI foundation.

The case has gripped Silicon Valley with the glimpse it has offered into the lives of the new titans of the AI age. It comes at a pivotal moment for Musk, Altman and the AI boom. Musk is racing to hold an initial public offering for his rocket company, SpaceX, which merged with his AI startup that had lost ground in the race. OpenAI is also seeking a public listing, although it has lost momentum in its contest with rival Anthropic.

Musk's lawyers sought to highlight his concern about the impact the AI industry could have on the world. In testimony, he called himself a "fool" to back OpenAI.

OpenAI's lawyers tried to demonstrate that the conversion was necessary for the startup to be able to secure the funding required to improve its AI technology. OpenAI's legal team also highlighted their company's commitments with the Los Alamos National Laboratory, the U.K. government and other organizations to address AI safety. They contrasted those with the lack of similar pledges by Musk's AI company, xAI.

The trial also revealed the existence of Brockman's personal diary, in which he confided his financial dreams. "Financially, what will take me to $1B?" read an entry that was entered as an exhibit in the case. In testimony, Brockman revealed his stake in OpenAI is now worth close to $30 billion.

Other technorati witnesses included Microsoft CEO Satya Nadella, former OpenAI Chief Technology Officer Mira Murati and OpenAI co-founder Ilya Sutskever, as well as Shivon Zilis, a former OpenAI board member and mother to four of Musk's children.

When Zilis took the stand in court, she testified about her time as a board member and noted her distrust of OpenAI's founders because of perceived personal investing conflicts, circumstances in which Altman and Brockman held stakes in companies that did business with OpenAI. That theme came up repeatedly in the trial.

Zilis also faced questions about whether she "funneled" information to Musk from her position at OpenAI. An OpenAI executive accused Zilis of failing to disclose that Musk was the father of her twins while she was a director for the organization. Musk's team and Zilis have insisted that Zilis acted independently.

News Corp, owner of The Wall Street Journal, has a content-licensing partnership with OpenAI.

Write to Georgia Wells at georgia.wells@wsj.com

 

(END) Dow Jones Newswires

May 14, 2026 16:22 ET (20:22 GMT)

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