OpenAI and Elon Musk Agree to Fast-Track Trial Over For-Profit Shift

Elon Musk and OpenAI to fast-track trial to December -- Musk looks to stop OpenAI's change to a for-profit company

OpenAI and Elon Musk have agreed to accelerate their legal dispute regarding OpenAI's transition to a for-profit model, according to Reuters. The trial is set for December. A recent court decision denied Musk's attempt to halt this transition but allowed the case to proceed. Meanwhile, the parties have postponed deciding whether the case will be settled by a judge or a jury. According to a filing in the U.S. District Court for the Northern District of California, both parties have chosen to postpone the decision on whether the expedited case will be resolved by a judge or a jury. However, they agreed that the proposed trial is set for December. Earlier this month, the judge rejected Musk's motion to pause OpenAI's structural shift. Elon Musk initiated legal proceedings to block OpenAI's shift to a for-profit structure last fall accusing the organization of departing from its original mission. OpenAI countered, claiming Musk is trying to hinder its progress to benefit his rival company, xAI. Furthermore, OpenAI argued that Musk had previously supported a for-profit transition for personal financial gain. Musk co-founded OpenAI in 2015, together with Sam Altman, Greg Brockman, and Ilya Sutskever, with the goal of advancing AI for the public good. He left the organization in 2018, citing concerns that a multibillion-dollar partnership with Microsoft violated OpenAI's nonprofit values by prioritizing profit over public interest. Following OpenAI's 2022 release of ChatGPT and its move toward commercial partnerships, Musk filed a lawsuit in March 2023 to stop the organization's planned restructuring. He later expanded the lawsuit to include Microsoft, accusing it of influencing OpenAI's shift toward profit-driven operations. OpenAI disputes Musk's claims, arguing that his actions are intended to disrupt its progress for the advantage of xAI, another venture of Musk. In fact, OpenAI presented evidence that in 2017, Jared Birchall, who manages Musk's family office, registered a company intended to be a for-profit version of OpenAI. Documents and text messages show Musk sought a 50-60% equity stake in the entity, claiming it was necessary to help finance an $80 billion Mars colonization project.

OpenAI and Musk agree to fast tracked trial over for-profit shift

OAKLAND, California, March 15 (Reuters) - OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in U.S. District Court for the Northern District of California. The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight. "We welcome the court's March 4 decision rejecting, opens new tab Elon Musk's latest attempt to slow down OpenAI for his personal benefit," OpenAI said in a blog post on Friday. Musk cofounded OpenAI with Altman in 2015 but left before the company took off and subsequently founded the competing startup xAI in 2023. Last year, the CEO of Tesla and owner of the X social media platform sued OpenAi and Altman, accusing OpenAI of straying from its founding mission -- to develop AI for the good of humanity, not corporate profit. OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor. At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race. OpenAI's last fundraising round,, opens new tab of $6.6 billion, and a new round of up to $40 billion under discussion with SoftBank Group (9984.T), opens new tab, are conditioned on OpenAI restructuring to remove the nonprofit's control. Friday's filing comes weeks after Altman, who has said OpenAI is not for sale, rejected a $97.4 billion unsolicited takeover bid from a Musk-led consortium with a "no thank you." Reporting from Anna Tong in Oakland and Devika Nair in Bengaluru; Editing by William Mallard Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Boards, Policy & RegulationADAS, AV & SafetySoftware-Defined VehicleSupply ChainSustainable & EV Supply Chain

OpenAI and Musk agree to fast tracked trial over for-profit shift

The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in U.S. District Court for the Northern District of California. The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight. "We welcome the court's March 4 decision rejecting Elon Musk's latest attempt to slow down OpenAI for his personal benefit," OpenAI said in a blog post on Friday. Musk cofounded OpenAI with Altman in 2015 but left before the company took off and subsequently founded the competing startup xAI in 2023. Last year, the CEO of Tesla and owner of the X social media platform sued OpenAi and Altman, accusing OpenAI of straying from its founding mission -- to develop AI for the good of humanity, not corporate profit. OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor. At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race. OpenAI's last fundraising round, of $6.6 billion, and a new round of up to $40 billion under discussion with SoftBank Group, are conditioned on OpenAI restructuring to remove the nonprofit's control. Friday's filing comes weeks after Altman, who has said OpenAI is not for sale, rejected a $97.4 billion unsolicited takeover bid from a Musk-led consortium with a "no thank you."

Elon Musk's feud with OpenAI CEO Sam Altman, explained

A bitter rift between two Silicon Valley billionaires could shape the future of the fast-growing artificial intelligence industry. Tesla Chief Executive Elon Musk, who has his own AI startup, is duking it out in court and in a public war of words with Sam Altman, leader of ChatGPT maker OpenAI. Musk, who is the world's richest man and has the ear of President Donald Trump, has referred to the San Francisco-based OpenAI chief executive as "Scam Altman." Meanwhile, Altman told Bloomberg that Musk is not "a happy person." Musk and Altman, along with several others, co-founded OpenAI in 2015. Underlying the personal feud is Musk's legal challenge to OpenAI, which threatens to slow the company's efforts at a time when the race for the lead in the AI space is heating up. Musk sued OpenAI last year for fraud, breach of contract and fiduciary duty over OpenAI's efforts to change its corporate structure. He's looking to the courts for an injunction to stop the company's "unlawful" conduct and seeking compensation for damages and fees. OpenAI has disputed many of the claims in Musk's lawsuit. "I wish he would just compete by building the better product, but I think there's been a lot of tactics, many, many lawsuits, all sorts of other crazy stuff. ... We'll try to just put our head down and keep working," Altman told Bloomberg. It began as a nonprofit company and later launched a for-profit subsidiary to oversee its commercial operations. Its product ChatGPT has millions of users and is a household name, helping bring generative AI into the mainstream. But with competition ratcheting up from Google, Amazon and others, OpenAI needed to raise significantly more money. To make that process easier, it embarked on a plan to explore changing the for-profit subsidiary to a public benefit corporation. That move irked early OpenAI investors like Musk, who said he invested more than $44 million from 2016 to 2020 in OpenAI under the belief it would remain a nonprofit serving humanity and not become beholden to shareholders concerned about profits. What does Musk allege? "OpenAI's conduct could have seismic implications for Silicon Valley and, if allowed to stand, could represent a paradigm shift for technology startups," Musk said in court records filed last year. Earlier this month, a judge ruled against Musk's request for a preliminary injunction that would prevent OpenAI from changing its corporate structure. However, some allegations Musk made against the company will go forward in a trial, unless the dispute is settled. In court filings, Musk alleged OpenAI has veered away from its founding principles. Musk said he invested significant money, helped recruit talent under that premise, served as co-chair and came up with the name "OpenAI." But Musk had a falling out with OpenAI's leaders after they could not agree on the future of the startup. Musk said in court filings that in 2017-2018 Altman and OpenAI co-founder Greg Brockman wanted to "recast the nonprofit as a moneymaking endeavor." Musk bristled, writing in an email, "Either go do something on your own or continue with OpenAI as a non-profit," according to legal documents. Musk stepped down from the board in 2018. How has OpenAI responded? OpenAI says Musk's lawsuit is simply meant to slow down a rival. The company alleges that Musk, while he was still on the board, wanted to take control of the startup or bring it under Musk's electric car company Tesla, which OpenAI did not believe was in its best interest. Since leaving OpenAI, Musk has become a direct competitor. In 2023, he launched xAI, which developed the AI assistant Grok and has raised billions in funding. "We're sad that it's come to this with someone whom we've deeply admired -- someone who inspired us to aim higher, then told us we would fail, started a competitor, and then sued us when we started making meaningful progress towards OpenAI's mission without him," the company said on its website last year. OpenAI said it welcomed the court's decision denying Musk's request for a preliminary injunction. "This has always been about competition," OpenAI said in a statement this week. "Elon's own emails show that he wanted to merge a for-profit OpenAI into Tesla. That would have been great for his personal benefit, but not for our mission or U.S. interests." Last month, Musk led an investment consortium to make an unsolicited offer to buy OpenAI for $97.4 billion, which OpenAI's board rejected. OpenAI said it is not for sale. What do experts think of the case? Legal experts and tech analysts say the case could play out in multiple ways. "The ultimate question is, is this a case of altruism versus greed, as Musk portrays, or is this a case of kind of corporate monopolistic prevention, as Altman and OpenAI present?" said Neil Elan, a partner with law firm Stubbs Alderton and Markiles LLP. "It's too early to tell." Gene Munster, managing partner of Minneapolis-based Deepwater Asset Management, said that, at the highest level, it's "understandable" that Musk is frustrated. "I think his motivations are, he felt like he got ripped off," Munster said. But Rob Enderle, principal analyst at advisory services firm Enderle Group, said he thinks it's "hypocritical" that Musk is bringing up these claims against OpenAI, when Musk is hugely wealthy. He's worth more than $340 billion, according to Forbes. "His real goal is to take the company over, and it has nothing to do with what he's actually presenting," Enderle said, adding he thinks the case should be dismissed. What happens next? The judge said she is prepared to expedite the trial to this fall to deal with the central issues of the case, though "ancillary claims" would have to be tabled to fit that timeline. Marc Toberoff, Musk's attorney, said they plan to accept the court's offer. "We're pleased the Court has offered an expedited trial on the core claims driving this case, which in its words present 'urgent' issues in the public's interest," Toberoff said in a statement. "We look forward to a jury confirming that Altman accepted Musk's charitable contributions knowing full well they had to be used for the public's benefit rather than his own enrichment." What are the possible outcomes? If a jury rules in Musk's favor, it would have huge implications for OpenAI. Such a result could have an unraveling effect of potentially implicating many of OpenAI's relationships and contracts with business partners, including Microsoft, which is one of its backers, experts said. "This might not only spell trouble for OpenAI but it also might result in an avalanche of unintended consequences," said Elan. Alternatively, if the case went OpenAI's way, there could be attorneys' fees and damages awarded to the firm and Altman. Musk might not be able to recover his investment in OpenAI, Elan said. While it is possible Musk and OpenAI could settle, Elan thinks it's unlikely, given the unique personalities involved. "Settlement requires a concession of the weaknesses of one's perception, perspective and claims, and it will be difficult, in my view, for such strong, big personalities to make such concessions," Elan said. "It's unlikely that both sides will be able to put that aside for the benefit of obtaining immediate closure."

OpenAI to See Fast-Tracked For-Profit Trial

OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in U.S. District Court for the Northern District of California. The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight.

OpenAI, Elon Musk Agree to Fast Tracked Trial Over For-Profit Shift

Musk sued OpenAI, Altman for chasing profits with a non-profit firm OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in US District Court for the Northern District of California. The judge this month denied Musk's request to pause the Artificial Intelligence (AI) group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight. "We welcome the court's March 4 decision rejecting Elon Musk's latest attempt to slow down OpenAI for his personal benefit," OpenAI said in a blog post on Friday. Musk cofounded OpenAI with Altman in 2015 but left before the company took off and subsequently founded the competing startup xAI in 2023. Last year, the CEO of Tesla and owner of the X social media platform sued OpenAI and Altman, accusing OpenAI of straying from its founding mission -- to develop AI for the good of humanity, not corporate profit. OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor. At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race. OpenAI's last fundraising round, of $6.6 billion (roughly Rs. 57,288 crore), and a new round of up to $40 billion (roughly Rs. 3,47,177 crore) under discussion with SoftBank Group, are conditioned on OpenAI restructuring to remove the nonprofit's control. Friday's filing comes weeks after Altman, who has said OpenAI is not for sale, rejected a $97.4 billion (roughly Rs. 8,45,442 crore) unsolicited takeover bid from a Musk-led consortium with a "no thank you." © Thomson Reuters 2025

OpenAI and Elon Musk agree to fast tracked trial over for-profit shift

Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday.OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in U.S. District Court for the Northern District of California. The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight. "We welcome the court's March 4 decision rejecting Elon Musk's latest attempt to slow down OpenAI for his personal benefit," OpenAI said in a blog post on Friday. Musk cofounded OpenAI with Altman in 2015 but left before the company took off and subsequently founded the competing startup xAI in 2023. Last year, the CEO of Tesla and owner of the X social media platform sued OpenAi and Altman, accusing OpenAI of straying from its founding mission - to develop AI for the good of humanity, not corporate profit. OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor. At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race. OpenAI's last fundraising round, of $6.6 billion, and a new round of up to $40 billion under discussion with SoftBank Group , are conditioned on OpenAI restructuring to remove the nonprofit's control. Friday's filing comes weeks after Altman, who has said OpenAI is not for sale, rejected a $97.4 billion unsolicited takeover bid from a Musk-led consortium with a "no thank you."

Elon Musk And Sam Altman Just Agreed On One Thing -- And No, It's Not A Business Deal

Elon Musk and OpenAI CEO Sam Altman have decided to speed up their ongoing legal battle concerning OpenAI's shift to a for-profit model. The trial is set to take place in December. What Happened: The two parties have reached a consensus to expedite the trial amidst their legal wrangling. In a court document filed on Friday, Elon Musk and OpenAI proposed to fast-track the trial for their dispute and postpone the decision on whether a jury will be involved in the case. Musk, who co-founded OpenAI, has been at odds with the company since his departure from its board in 2018. He formally instigated the dispute last year by suing OpenAI in a California state court, claiming that the company had "betrayed" its mission by introducing a for-profit arm in 2019 and strengthening its alliance with Microsoft in 2023. Also Read: Elon Musk Battles OpenAI Over Move To For-Profit Model -- And Experts Are Pushing Back Earlier this month, US District Judge Yvonne Gonzalez Rogers denied Musk's request for an injunction on OpenAI's restructuring, but agreed to fast-track the trial over "interrelated contract-based claims". OpenAI, for its part, has expressed satisfaction with the decision and is eager to present its case in court. In February, Musk also made a $97.4 billion acquisition offer for the company, which was promptly turned down by OpenAI CEO Sam Altman. Why It Matters: This legal dispute is a significant development in the AI industry, as it involves two major players, Elon Musk and OpenAI. The outcome of this case could potentially influence the future direction of AI companies and their decision to transition to a for-profit model. Furthermore, the trial's expedited timeline indicates the urgency and importance attached to this case by both parties. The legal battle also underscores the ongoing tension between Musk and OpenAI, which could have far-reaching implications for their respective roles in the AI sector. Read Next Musk Goes To Court To Block OpenAI's For-Profit Transition This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Market News and Data brought to you by Benzinga APIs

Musk vs OpenAI Nonprofit Trial Could Commence in December | PYMNTS.com

OpenAI and Elon Musk have reportedly agreed to a trial date over OpenAI's for-profit transition. The artificial intelligence (AI) startup and the world's wealthiest person have agreed to fast-track the trial, jointly proposing a December court date, Reuters reported Saturday (March 15), citing court documents. Still undecided is the issue of whether the case will be heard by a jury or just by a judge, the report added. Musk helped found OpenAI with CEO Sam Altman in 2015, but left the company before the generative AI boom took off. (He has since founded a competing startup, xAI.) In 2024, Musk sued OpenAI and Altman, saying the company had deviated from its roots as a nonprofit company that wanted to build AI to help humanity. Altman and his company have denied Musk's claims, with Altman saying Musk is simply trying to disrupt a rival. OpenAI has also said that the switch to a for-profit model is critical to help it raise capital and compete with other AI firms. The company's $6.6 billion funding round last year -- as well as another planned $40 billion round -- are contingent on OpenAI shedding the control of the nonprofit entity that governs it. "OpenAI's freedom-focused policy proposals, taken together, can strengthen America's lead on AI and in doing so, unlock economic growth, lock in American competitiveness and protect our national security," OpenAI Chief Global Affairs Officer Christopher Lehane wrote in the comments submitted to the White House Office of Science and Technology Policy. Among the company's proposals is one calling on the federal government to preempt the states on AI-related laws, giving the industry relief from the increasing number of bills being considered by states. AI companies that opt-in to this offer would let the federal government access their AI models to ensure safety and test capabilities. The company is also proposing that the federal government develop an export control strategy that not only restricts the flow of AI technologies to China while enhancing the export of the technologies to democratic countries.

Elon Musk vs. Sam Altman: The Battle Over OpenAI's Future Intensifies

Musk and Altman's AI Clash: From Co-founders to Rivals in OpenAI Power Struggle Elon Musk and Sam Altman were once collaborators at . Both of them are now embroiled in a public dispute over where the company is headed. What has led to this fall out is their differing visions. Apart from that, they have also led to legal battles and public exchanges. Musk and Altman co-founded OpenAI in 2015. Their main aim was to develop artificial intelligence for the greater good. But after the internal disagreements, Musk departed in 2018. Subsequently OpenAI transitioned into a for-profit entity, attracting huge investment giants like Microsoft. Musk says that this shift contradicts the original mission of OpenAI. In February 2024, he filed a lawsuit against OpenAI and Altman. In his lawsuit, he was alleging a departure from their foundational principles. These legal actions from Musk show his belief that the current trajectory of OpenAI prioritizes market profit rather than benefiting the public. Moving on to February 2025, Musk proposed a acquisition of OpenAI to realign it with its initial mission. Altman this bid promptly and stated that OpenAI is not for sale. was yet far from over. This escalated with both parties agreeing to expedite their legal proceedings. A trial is anticipated in December 2025 to address the lawfulness of OpenAI's transition to a for-profit model. This decision also goes ahead to reflect the public interest in the future of the company and the broader implications for AI advancement. Moving on with the same, public exchanges between Musk and Altman have also risen. Following Musk's acquisition proposal, Altman retorted by offering to buy Twitter for $9.74 billion, to which Musk responded by calling Altman a "swindler." Altman has also gone ahead to comment on Musk's demeanor publicly, suggesting that Musk operates "from a position of insecurity." These heated exchanges show how the cold war between these two is far from over. shows the challenges tech leaders face in balancing innovation with ethical considerations. Moving forward toward the hearing of the lawsuit, the outcomes of this dispute may influence how companies align technological advancement with societal benefit.

OpenAI and Musk agree to fast tracked trial over for-profit shift

OAKLAND, California (Reuters) - OpenAI and Elon Musk have agreed to fast-track a trial over OpenAI's for-profit shift, the latest turn in a grudge match between the world's richest person and OpenAI CEO Sam Altman playing out publicly in court. Billionaire Elon Musk and OpenAI jointly proposed a trial in December, according to a federal court filing on Friday. The parties agreed to delay a decision on whether the expedited case will be decided by a jury or solely by the judge, said the filing in U.S. District Court for the Northern District of California. The judge this month denied Musk's request to pause the artificial intelligence group's transition to a for-profit model but agreed to an expedited trial in the autumn, the latest turn in the high-stakes legal fight. "We welcome the court's March 4 decision rejecting Elon Musk's latest attempt to slow down OpenAI for his personal benefit," OpenAI said in a blog post on Friday. Musk cofounded OpenAI with Altman in 2015 but left before the company took off and subsequently founded the competing startup xAI in 2023. Last year, the CEO of Tesla and owner of the X social media platform sued OpenAI and Altman, accusing OpenAI of straying from its founding mission -- to develop AI for the good of humanity, not corporate profit. OpenAI and Altman have denied the allegations, while Altman alleges that Musk has been trying to slow down a competitor. At stake in the lawsuit is the ChatGPT maker's transition to a for-profit model, which the startup says is crucial to raising more capital and competing well in the expensive AI race. OpenAI's last fundraising round, of $6.6 billion, and a new round of up to $40 billion under discussion with SoftBank Group, are conditioned on OpenAI restructuring to remove the nonprofit's control. Friday's filing comes weeks after Altman, who has said OpenAI is not for sale, rejected a $97.4 billion unsolicited takeover bid from a Musk-led consortium with a "no thank you." (Reporting from Anna Tong in Oakland and Devika Nair in Bengaluru; Editing by William Mallard)