Elon Musk Revives Lawsuit Against OpenAI and Sam Altman in Federal Court

Elon Musk files new lawsuit against OpenAI and Sam Altman

Elon Musk has filed a new lawsuit against OpenAI and its chief executive Sam Altman, accusing the artificial intelligence company that he helped co-found of compromising its mission to benefit humanity. The tech billionaire's lawsuit filed in a California federal court comes two months after he abruptly withdrew a similar case in state court. The filing on Monday includes new allegations that Altman and his co-founder Greg Brockman broke federal racketeering laws. "Altman and his longtime associate Brockman assiduously manipulated Musk into co-founding their spurious non-profit venture," only for them to switch to a for-profit mission as they deepened OpenAI's relationship with Microsoft, the lawsuit alleged. Musk's long-running dispute with Altman started in 2018 when he left OpenAI's board, following a disagreement with Altman over the direction of its research. OpenAI's for-profit division was established a year later. Microsoft has invested $13bn in the company through a complex ownership structure now under investigation by US and EU regulators. Musk launched his own for-profit AI start-up, xAI, last year. Last month, he said he would seek approval from Tesla's board to invest $5bn in the company, as he sought to catch up with rivals such as OpenAI, the maker of chatbot ChatGPT, in offering larger and more AI models. OpenAI did not immediately respond to a request for comment.

Elon Musk is suing OpenAI and Sam Altman again

Elon Musk has revived his complaint against OpenAI after dropping a previous lawsuit, again alleging that the ChatGPT maker and two of its founders -- Sam Altman and Greg Brockman -- breached the company's founding mission to develop artificial intelligence technology to benefit humanity. The new lawsuit filed in federal court in Northern California on Monday says that Altman and Brockman "assiduously manipulated Musk into co-founding their spurious non-profit venture" by promising that OpenAI would be safer and more transparent than profit-driven alternatives. The suit claims that assurances about OpenAI's non-profit structure were "the hook for Altman's long con." Musk made similar accusations in a "hilariously bad" lawsuit that he withdrew in June without explanation, which focused on claims that OpenAI breached its founding agreement between Musk and other co-founders to keep the company's technology open source. "This is a much more forceful lawsuit," Musk's lawyer, Marc Toberoff, said to The New York Times. The new suit argues that OpenAI broke federal racketeering laws in a conspiracy to defraud Musk and that its contract with Microsoft would revoke the tech giant's rights to OpenAI's technology once artificial general intelligence (AGI) had been achieved.

Elon Musk revives lawsuit against OpenAI, Sam Altman in federal court

Elon Musk has revived a lawsuit against Sam Altman in a federal court, alleging that the Tesla boss was manipulated into co-founding OpenAI, according to a court filing published on Monday. The crux of Musk's claims center around his view that he was "courted and deceived" by Altman and current OpenAI President Greg Brockman, into co-founding the artificial intelligence firm on the basis that it was a non-profit. After Musk came on board and invested millions of dollars, the lawsuit claims he was "betrayed by Altman and his accomplices" as they, along with Microsoft, "established an opaque web of for-profit OpenAI affiliates, engaged in rampant self-dealing." "The perfidy and deceit are of Shakespearean proportions," the lawsuit alleges. The claims in the new lawsuit are similar to another lawsuit filed by Musk against OpenAI and Altman in California this year, which the Tesla and SpaceX boss ultimately dropped. Musk has been very vocal over the past few years about his fear of artificial intelligence and the dangers it poses to humanity. Musk states in the latest lawsuit, filed in a district court in Northern California, that he was "manipulated" into co-founding OpenAI by Altman and Brockman who allegedly promised "that it would chart a safer, more open course than profit-driven tech giants." "Altman assured Musk that the non-profit structure guaranteed neutrality and a focus on safety and openness for the benefit of humanity, not shareholder value. But as it turns out, this was all hot-air philanthropy -- the hook for Altman's long con," the lawsuit claims.

Elon Musk is having another go at suing OpenAI and Sam Altman -- here's why

This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in. Musk's lawyers also claimed that the billionaire was "assiduously manipulated" by Altman and Brockman into cofounding OpenAI, a nonprofit that would focus on building AI safely with an open approach for the benefit of humanity. But the lawyers claimed it was "all hot-air philanthropy -- the hook for Altman's long con." "After Musk lent his name to the venture, invested significant time, tens of millions of dollars in seed capital, and recruited top AI scientists for OpenAI, Inc., Musk and the non-profit's namesake objective were betrayed by Altman and his accomplices. The perfidy and deceit are of Shakespearean proportions," Musk's lawyers argued. The lawsuit also stated that Musk was told OpenAI would hire leading scientists to compete with Google's DeepMind in a race to build artificial general intelligence (AGI). However, the lawyers argue that the company created a for-profit entity once it approached creating AGI. Altman, Musk, and Brockman founded OpenAI in December 2015 as a nonprofit research lab. Musk departed in 2018, but his lawyers said in the first lawsuit that he "continued to make contributions to OpenAI" until mid-September 2020. OpenAI now describes itself as a "capped-profit" company. In 2019, it created OpenAI LP, a for-profit and nonprofit hybrid. In a blog post at the time, OpenAI said the idea was for investors and employees to get a "capped return" if it successfully achieved its mission. Musk's lawyers describe the transition to a hybrid structure as a shift to "a vehicle for Altman and his partners' self-enrichment" which they argue is evident in its partnership with Microsoft. Musk set up his own AI firm, xAI, in 2023. The mission of the for-profit company is to "advance our collective understanding of the universe." Musk first sued OpenAI and cofounders Sam Altman and Greg Brockman in March and accused the company of jeopardizing its nonprofit mission by partnering with Microsoft. OpenAI responded to the suit by calling it "incoherent" and "contradictory" and published emails between OpenAI executives and Musk in a bid to dismiss his claims. Musk then dropped his lawsuit against OpenAI, Altman, and Brockman in June, just a day before a judge was set to consider the case's future during a hearing. OpenAI, Altman and Brockman didn't immediately respond to requests for comment from Business Insider, sent outside normal working hours.

Elon Musk Revives Lawsuit Against OpenAI and Sam Altman

Elon Musk has revived a lawsuit against OpenAI, the maker of the A.I. chatbot ChatGPT, refueling a six-year-old feud that began with a power struggle at the San Francisco start-up. Like the original suit, the new complaint, filed on Monday in federal court in Northern California, claims that OpenAI and two of its founders, Sam Altman and Greg Brockman, breached the company's founding contract by putting commercial interests ahead of the public good. Mr. Musk withdrew his original suit seven weeks ago, without an explanation, one day before a judge was set to rule on whether it should be dismissed. After joining with Mr. Musk to create OpenAI in 2015 and pledging to carefully develop artificial intelligence for the benefit of humanity, the suit claims, Mr. Altman and Mr. Brockman abandoned this mission by entering a multibillion-dollar partnership with Microsoft. Mr. Musk was "betrayed by Mr. Altman and his accomplices," the suit said. "The perfidy and deceit is of Shakespearean proportions." OpenAI did not immediately respond to a request for comment. In a blog post responding to Mr. Musk's first suit against OpenAI, Mr. Altman and others at the company said that they intended to ask that its claims be dismissed and that the company aimed to serve the public good by building artificial general intelligence, or A.G.I., a machine that can do anything the human brain can do. "The mission of OpenAI is to ensure A.G.I. benefits all of humanity, which means both building safe and beneficial A.G.I. and helping create broadly distributed benefits," they said. When Mr. Musk founded OpenAI with Mr. Altman, Mr. Brockman and several young A.I. researchers, he envisioned the research lab as a necessary counterweight to A.I. work being done by Google. He believed that Google and its co-founder Larry Page were not sufficiently concerned with A.I.'s dangers. Echoing the warnings of some others in the field, Mr. Musk worried that A.I. could one day destroy humanity. Mr. Altman and other OpenAI founders expressed similar concerns at the time. They created OpenAI as a nonprofit and vowed to freely share its technology with the public. They argued that A.I. would be too powerful and too dangerous to be controlled by a single entity like Google. Mr. Musk parted ways with OpenAI in 2018 after a power struggle, withdrawing his financial support. Forced to find other sources of funding, Mr. Altman transformed OpenAI into a for-profit company and eventually raised $13 billion from Microsoft. In 2022, OpenAI released ChatGPT, a chatbot that can generate text and answer questions in humanlike prose. This spurred an industrywide race toward A.I., spanning tech giants like Google and Microsoft as well as a new wave of start-ups. Mr. Musk founded his own A.I. company, xAI, last year while still warning against the dangers of the technology. (The New York Times has sued OpenAI and Microsoft, claiming copyright infringement of news content related to A.I. systems. The two companies have denied the suit's claims.) In November, OpenAI's board of directors unexpectedly fired Mr. Altman, saying he could no longer be trusted with the company's mission to build A.I. for the good of humanity. He was reinstated five days later. About two months after that, Mr. Musk sued OpenAI in a state court in San Francisco. The new suit, filed in federal court, claims that Mr. Altman and Mr. Brockman knowingly misled him when they teamed up with him to create OpenAI. "Elon Musk's case against Sam Altman and OpenAI is a textbook tale of altruism over greed," the suit said. "Altman, in concert with other defendants, intentionally courted and deceived Musk, preying on Musk's humanitarian concern about the existential dangers posed by A.I." The suit claims that Mr. Altman and Mr. Brockman have backtracked on their promise to freely share, or open source, their company's technologies and opted instead to provide Microsoft with an exclusive license to the technologies. Mr. Musk filed the new suit in federal court in part because it argues that OpenAI violated federal racketeering laws by conspiring to defraud Mr. Musk, his lawyer, Marc Toberoff, said in an interview. "The previous suit lacked teeth -- and I don't believe in the tooth fairy," he said. "This is a much more forceful lawsuit." The suit argues that OpenAI's contract with Microsoft specifies that the tech giant would no longer have a right to OpenAI's technology once the lab had achieved A.G.I. It asks the court to decide whether OpenAI's latest systems have achieved A.G.I. and determine whether the company's contract with Microsoft should be voided. Most experts say that OpenAI's current technology is not A.G.I. and that scientists do not yet know how to build such a system. In late May, OpenAI announced that it had started working on a new artificial intelligence model that would succeed the GPT-4 technology that drives ChatGPT. The company said it expected the new model to bring "the next level of capabilities." OpenAI is valued at more than $80 billion, according to its latest funding round. Mr. Musk's company, xAI, is valued at $24 billion.

Breaking: Elon Musk Renews Lawsuit Against Sam Altman's OpenAI

Elon Musk has re-escalated a lawsuit against Sam Altman's OpenAI, claiming that the AI giant breached the founding contracts by prioritizing commercial interests. The renowned American entrepreneur Elon Musk has once again made global headlines, re-escalating a lawsuit against Sam Altman's OpenAI. According to a recent report, the Tesla and SpaceX lead is again suing the AI giant and its co-founders Sam Altman and Greg Brockman over breachment of the company's founding contract. With the abovementioned lawsuit's refiling, the six-year-old feud that began with OpenAI's collaboration with Microsoft takes a new turn. Elon Musk Sues OpenAI & Its Co-founders Notably, the renewed lawsuit claims that OpenAI ditched its founding contract by prioritizing commercial interests over public good. The latest lawsuit by Musk comes as a follow-up of a previously filed lawsuit by the Tesla CEO on the same grounds, although it was subsequently withdrawn. Elon Musk co-founded OpenAI alongside Altman and Greg, aiming for AI development for the betterment of the public good. However, Musk claims that the AI firm's multibillion-dollar partnership with Microsoft has breached the original founding contract.

Elon Musk Sues OpenAI and Its CEO in New Lawsuit Challenging Microsoft Partnership

U.S. Government Expands Fight Against TikTok With New Lawsuit Elon Musk is reigniting a legal battle against OpenAI over its for-profit pivot, this time looking to void the company's partnership with Microsoft. The lawsuit, filed in the Northern District of California on Thursday, alleges fraud and breach of contract over claims that the Tesla founder was swindled when he invested roughly $45 million into the AI venture, which he says betrayed its original mission to safely develop the technology "for the benefit of humanity." In Musk's telling, chief executive Sam Altman illegally partnered with Microsoft to establish a web of illicit affiliates and plunder its non-profit arm of assets and staff in violation of their deal. Musk seeks a court order invalidating OpenAI's exclusive license with Microsoft giving it unique access to the underlying code of GPT-4, as well as treble damages and disgorgement of profits attributed to his investments in the company. It names Altman, president Greg Brockman and dozens of subsidiaries. In Hollywood, utilization of AI tools in the production pipeline is positioned to be the next battleground between creators and studios. With the introduction of Sora, capable of creating hyper-realist videos with a prompt of just a couple sentences, OpenAI is courting the industry amid the rise of the technology. Marc Toberoff, a lawyer for Musk who regularly sues studios on behalf of creators to claw back the copyrights to their works, stresses that AI tools -- if controlled by a handful of companies, like OpenAI and Microsoft -- threatens talent. "This case is about far more than money, the future of AGI lies in the balance," he says. AI is increasingly being adopted in concept art, visual effects and post production amid belt-tightening, displacing some workers. Musk's ties to OpenAI can be traced back to 2015, when he cofounded the company among a group of other prominent Silicon Valley investors. The lawsuit points to messages from Altman as proof that he defrauded Musk, who was told in an email, "The technology would be owned by the foundation and used 'for the good of the world." Per its certificate of incorporation, a legal document relating to the formation of a company, OpenAI said it "will seek to open source technology for the public benefit." It adds that that company will "not be organized for the private gain of any one person" and that "no part of the net income or assets of this corporation shall ever inure to the benefit of any director, officer or member." The lawsuit details Microsoft's early courtship of OpenAI while Musk was still with the company. In 2016, the Satya Nadella-led firm offered to sell "Compute" to the company at a steep discount if it'd agree to publicly promote Microsoft's products, according to the complaint. "This actually made me feel nauseous," he wrote to Altman, the lawsuit states. "It sucks and is exactly what I would expect from them." Later that year, the two companies announced a partnership giving OpenAI access to Microsoft's latest technology for running large-scale AI training. But after he left the board in 2018 due to a potential conflict of interest with Tesla, which he owns and was ramping up its focus on AI, Musk claims Altman directed the company to form numerous for-profit entities. This includes OpenAI, L.P., which was established as a "capped-profit company." And with the creation of a for-profit arm, Altman allegedly transferred the non-profit division's staff and assets to the new company. OpenAI's dozens of other affiliates were woven into its "corporate web for the purpose of profiting from the non-profit's assets" as part of a "shell game," the lawsuit says. "Just follow the money," states the complaint. "The non-profit's 2022 IRS tax return showed just $44,485.00 in revenue, but one year later, OpenAI overall reportedly generated hundreds of millions of dollars." Musk also alleges that Altman withheld and misrepresented information to the board, going as far as to lie in some business dealings. In discussions with the nonprofit, he allegedly claimed to be an independent board member of OpenAI Startup Fund while omitting that he owns the company. Other instances of alleged self-dealing include OpenAI's partnership with Reddit in a deal in which the social media platform's content can be shown on ChatGPT, as well as a $51 million chip deal with Rain, another company in which he's a significant shareholder, according to the complaint. "And currently, on information and belief, OpenAI is hammering out a deal with Helion Energy (in which Altman owns a massive stake) for [it] to buy vast quantities of electricity to power its data centers," the lawsuit states. On "The TED AI Show" podcast, former OpenAI board member Helen Toner, who was a part of ousting Altman in November before he was reinstated, said "Sam had made it really difficult for the board to" fulfill its mission to safely develop the technology by "in some cases, outright lying." The lawsuit claims Musk seized control of the company's board alongside Microsoft to further undermine safety guardrails, with the goal of maximizing profits. The filing of the complaint follows Musk in June dropping a similar lawsuit against OpenAI and Altman without explanation. He's openly criticized the company for abandoning its original structure. Last year, Musk founded xAI, which has since reached a valuation of $24 billion. Musk is represented by Toberoff, widely considered among the entertainment industry's preeminent copyright termination lawyers. He's brought lawsuits on behalf of estate of Steve Ditko, who co-created Spider-Man and Doctor Strange, the heirs to the writer of the magazine story that spawned Top Gun and Lance Hill, who wrote the screenplay for Road House.