The battle between Elon Musk and OpenAI in the US court

During the second day of cross-examination on April 29, Musk continuously argued with OpenAI’s lawyer. Legal representatives of both sides also focused on the disagreement between the American billionaire and the company that started the generative AI race.

Theo CNNMusk said that OpenAI “betrayed its non-profit mission” when transforming business operating structures. In contrast, OpenAI criticized Musk’s lawsuit as an attempt to hinder the company’s competitive position with xAI, a business founded by the American billionaire.

Musk’s lawyer also published conversations between the American billionaire and OpenAI’s leadership, to prove that ChatGPT developer deceived him. William Savitt, a lawyer representing OpenAI, questioned whether the idea for the company to pursue profits came from Musk himself.

“I’m an idiot”

Most of the questions on Monday revolved around internal emails between Musk and OpenAI leadership, which mentioned a potential plan to build a “for-profit” corporate structure. Musk did not object to the plan, on the condition that “the for-profit division remains part of the non-profit enterprise”.

“You can’t make the for-profit part the main factor. That’s exactly what’s happening,” Musk explained in court.

Musk was also questioned about his decision to instruct Jared Birchall, head of his family office, to register a public benefit company under the name OpenAI in 2017. “I did it just in case it was necessary,” the xAI boss said.

In emails released as evidence in court, Musk said he needed control of the business. “I want to make sure it stays on track and almost all of the budget comes from me,” he told the court.

When other co-founders expressed concerns about this management method, Musk said that they had “swallowed” and went against previously agreed agreements. “What they really want is to set up a for-profit business where each person owns as many shares as possible,” he said.

In another email, Musk told his co-founders that he would cut off funding until OpenAI made a firm commitment that the business would continue to operate as a non-profit. “I am an idiot. I provided free capital for them to establish a startup,” he expressed at the trial.

Microsoft’s involvement in OpenAI’s growth also plays a central role in Musk’s lawsuit. OpenAI announced in 2022 that it had received a $10 billion investment from Microsoft. The company then had a for-profit division and was valued at about $20 billion. Musk said this was when he lost trust in Sam Altman and became increasingly concerned that “they were trying to steal support money”.

“I feel like it’s a show of ‘hanging goats’ heads and selling dog meat’,” he said.

The American billionaire sent Altman a link to an article revolving around the value of OpenAI in 2022. “I agree that this looks bad. We once proposed to divide equity for you when setting a maximum profit level, which you did not want at that time. We are still ready to do this whenever you want,” Altman replied in a message published in court.

Attorney Savitt sought to point out inconsistencies between Musk’s statements in court and posts on social network X, from whether Tesla developed artificial general intelligence (AGI) or not, to the amount of money he actually provided to OpenAI.

Savitt also delved into the issue of whether Musk had ever suggested that OpenAI establish a for-profit division, pointing to several emails and meeting recordings showing that the American billionaire appeared to say OpenAI needed a for-profit division to compete with Google.

Theo Business Insidera series of questions from OpenAI representatives led to tense exchanges with Musk and judge Yvonne Gonzalez Rogers. “Your questions are not simple, basically designed to fool me,” Musk said when Savitt asked him to just answer “yes” or “no”.

Judge Rogers then had to interrupt both sides.

The legal battle revolves around the future of AI

On the first day of questioning, Musk affirmed that he played a key role in the founding of OpenAI. The company is expected to benefit humanity, using open source code and going against businesses that only aim to bring profits to shareholders. He said the decision to build OpenAI stemmed from his long-standing concerns about AI, as well as the risk of the technology harming humans.

Musk is expected to continue to answer the podium for the third consecutive day today, before OpenAI’s lawyer ends his examination and it is the turn of the group representing American billionaires to ask questions.

Musk is the first witness in the civil lawsuit against OpenAI and CEO Sam Altman. He sued OpenAI in 2024, then withdrew the lawsuit and continued to sue, accusing his former company, Altman and Microsoft of betraying the non-profit mission.

The trial is expected to have witnesses from many names such as Musk, Altman and Microsoft CEO Satya Nadella. In addition, Shivon Zilis, a former board member of OpenAI who has four children with Musk, will also participate. The lawsuit is considered to be of great importance, capable of reshaping the field of artificial intelligence.

The 9-person jury will advise Judge Rogers on whether to impose proposals proposed by Elon Musk, such as returning OpenAI to a non-profit model, dismissing CEO Altman and Chairman Peter Brockman, compensating 130 billion USD and paying this amount to OpenAI’s non-profit fund.