Elon Musk has escalated his battle against OpenAI, filing a legal motion to block the company’s shift to a for-profit structure.
In court filings, Musk claims OpenAI has become monopolistic, leveraging its dominance in artificial intelligence to sideline competitors like his own AI startup, xAI. He also accuses OpenAI and CEO Sam Altman of prioritizing profit over ethics after accepting billions in funding from Microsoft in 2019.
“It cannot lumber about the marketplace as a Frankenstein, stitched together from whichever corporate forms serve the pecuniary interests of Microsoft and Altman at any given moment,” Musk’s legal team stated.
Musk contends that OpenAI’s partnerships and exclusive agreements violate federal antitrust laws by restricting competition and funding for rivals. He is seeking a court injunction to stop OpenAI’s restructuring and block future agreements he views as anti-competitive.
OpenAI dismissed Musk’s claims, calling them “baseless.” A spokesperson stated, “Musk’s filing again recycles the same baseless complaints and continues to be utterly without merit.”
The company is reportedly in early discussions with California’s attorney general’s office about its restructuring. OpenAI maintains that any potential changes will safeguard its nonprofit mission. Bret Taylor, OpenAI’s nonprofit board chairman, recently assured stakeholders that the nonprofit entity would “continue to exist and thrive” in any future model.
OpenAI began in 2015 as a nonprofit committed to advancing AI for societal benefit. However, the high costs of AI development led to the creation of a capped for-profit subsidiary in 2019. This allowed OpenAI to secure significant investments, including a recent $6.6 billion funding round that boosted its valuation to $157 billion.
Musk has consistently opposed OpenAI’s shift toward commercialization. This latest filing marks his third legal attempt to challenge its trajectory. He previously filed lawsuits in February and August 2024, arguing that the company has strayed from its founding principles.
Meanwhile, Musk’s own AI startup, xAI, has rapidly grown since its 2023 launch. Valued at $50 billion as of November 2024, xAI continues to position itself as a rival to OpenAI’s dominance.
