The Wacky Musk-OpenAI Legal Battle Now Involves a Fairly Insane Amount of Money
One of the many interesting details in the multi-year legal battle between Elon Musk and OpenAI is that OpenAI president Greg Brockman saw it coming too far, writing in a 2017 diary entry that he couldn’t “see us doing this for profit without a serious fight” with Elon Musk. Neither side disputes that Brockman wrote this.
And what could be worse than the richest man in the world suing your company (and Microsoft) for $134 billion, a sum almost equal to Kenya’s GDP, and more than Tesla’s revenue last year?
OpenAI has been consistent in its public statements, saying the lawsuit is baseless and part of a campaign of harassment. Specifically, one on January 8 called the accusation “baseless and part of his ongoing pattern of abuse.” On January 16, according to Bloomberg, OpenAI said “The case of Mr.
If there is any basis for this latest claim, it has been clarified in a recent court filing on the plaintiff’s side in this case. The document is short and to the point, and concerns “unfair benefits,” which should have been the name of an ESPN documentary podcast about Jose Canseco.
The “improper benefits” argument stems from Musk’s claim that he received $38 million or about 60 percent of OpenAI’s seed money needed to start operating as a non-profit organization, and that he made “non-monetary contributions,” such as defrauding “key personnel,” including his founders to communicate with people, educate them, and “lend his fame and fortune.”
In the early story of OpenAI, Musk appears as an important ancestor of OpenAI who quietly parted ways with it. The New York Times, for example, wrote in 2018 that “In 2015, Elon Musk, the CEO of the electric car manufacturer Tesla, and other well-known people in the technology industry created OpenAI and moved it to offices in the north of Silicon Valley in San Francisco,” but that, “he stepped down from the board of OpenAI, and that may allow him” to remove the conflict in the future.
The crux of Musk’s suit is that OpenAI went against its stated mission after Musk offered the funding that got it off the ground. It underwent a restructuring that resulted in the nonprofit becoming almost entirely a public profit organization—though it is still controlled to some extent by a separate nonprofit called the OpenAI Foundation.
Musk, as you no doubt know, went on to acquire one of OpenAI’s biggest competitors, xAI, at an estimated $230 billion, which is less than double the amount he is now seeking for his OpenAI suit. xAI is entirely for-profit, and although it was once a public benefit organization, that responsibility was “confidentially” abandoned last year, according to CNBC.
The exact demand from Musk has yet to be calculated. According to the filing, he “intends to seek other monetary remedies at trial, including punitive damages.”
