Elon Musk is looking a chin down 134 dollars billion and for more damage OpenAI and for defrauding its investor Microsoft by changing OpenAI’s corporate structure from non-profit to for-profit. But in an amendment on Tuesday, Musk asked for the damages to be awarded to OpenAI’s non-profit arm.
per head correctionMusk also wants OpenAI CEO Sam Altman and president Greg Brockman to step down, and for the two executives to hand over “all equity and other personal financial benefits from OpenAI’s commercial operations” to the OpenAI charity.
In 2015, Musk was a co-founder and major early investor in OpenAI when the AI giant launched as a non-profit AI lab. Musk and OpenAI eventually parted ways, an event that resulted in Musk leaving the company and later founding OpenAI competitor xAI in 2023. Musk via xAI unsolicited offer It will buy OpenAI in February 2025 for $97.4 billion.
Since Musk’s departure, OpenAI has changed its corporate structure, first from a non-profit organization to a “closed” for-profit organization in 2019, and finally to a for-profit public benefit corporation late last year. The company is reporting now Looking for an IPO In the fourth quarter of this year, a few months after Musk’s newly merged xAI and SpaceX market debut.
Musk now claims he was manipulated into thinking he was giving money to create a non-profit organization when the whole plan was for profit.
“Defendants pocketed the benefits of this charitable status—tax exemptions, donor contributions, and the reputational trust of a public good mission—secretly planned and ultimately executed OpenAI’s wholesale transformation into a for-profit enterprise, Microsoft and other investors,” the lawsuit states.
It is now asking the court to “unwind” the for-profit conversion and restructuring and return the funds to the nonprofit. OpenAI denies claims.
“The remedies Musk intends to seek are strictly related to his purpose in bringing this lawsuit: to prevent the personal, commercial interests of the public charity he founded and was a major supporter of during its formative years,” the amendment reads.
But according to the findings, a New Yorker study Published on Monday, Musk was involved in discussions about restructuring OpenAI as a for-profit company in September 2017, and he demanded majority control of any for-profit structure.
The case, which has turned into a grueling legal battle between the parties, will go to trial later this month. Both sides are upping the ante ahead of the court showdown. Posted by OpenAI on Monday letter It asked the attorneys general of Delaware and California to investigate Musk and another competitor, Meta, for “improper and anti-competitive conduct.”
