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Home » OpenAI’s legal battle with Elon Musk reveals internal turmoil to avoid AI ‘dictatorship’
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OpenAI’s legal battle with Elon Musk reveals internal turmoil to avoid AI ‘dictatorship’

4 Mins Read
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A 7-year-old rivalry between tech leaders Elon Musk and Sam Altman over who should lead OpenAI and prevent an artificial intelligence “dictatorship” is now heading to a federal judge as Musk seeks to halt the ongoing transition of maker of ChatGPT towards a for-profit business. business.

Musk, an early investor and board member of OpenAI, sued the artificial intelligence company earlier this year alleging that it had betrayed its founding purposes as a nonprofit research laboratory benefiting the public good rather than seeking profits.

Musk has since escalated the dispute, adding new claims and seeking a court order that would end the conflict. OpenAI projects to more fully transform into a for-profit business.

The world’s richest man, whose companies include Tesla, SpaceX and social media platform X, launched his own rival AI company, xAI, last year. Musk says he faces unfair competition from OpenAI and its close business partner Microsoft, which has provided the enormous computing resources needed to build AI systems such as ChatGPT.

“OpenAI and Microsoft together exploiting Musk’s donations so they can create a for-profit monopoly, now specifically targeting xAI, is simply too much,” says Musk’s filing which alleges the companies are violating the terms of Musk’s core contributions. Musk at the charity.

OpenAI filed a response Friday opposing Musk’s requested order, saying it would “debilitate OpenAI’s business and mission” to benefit Musk and his own AI company and that it relies on “far-fetched” legal allegations. A hearing is scheduled for January before U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California.

At the heart of the dispute is an internal power struggle within the young startup in 2017, which led to Altman becoming CEO of OpenAI.

Musk also sought to become CEO and outlined a plan in an email where he would “unequivocally have initial control of the company” but said it would be temporary. He became frustrated after two other OpenAI co-founders said he would hold too much power as a major shareholder and chief executive if the startup succeeded in its goal of achieving better-than-human AI, known under the name of general artificial intelligenceor AGI. Musk has concerns expressed for a long time about how advanced forms of AI could threaten humanity.

“The current structure provides you with a path to absolute unilateral control over AGI,” said a 2017 email to Musk from co-founders Ilya Sutskever and Greg Brockman. “You have stated that you do not want to control the AGI. Final AGI, but during this negotiation you have shown us that absolute control is extremely important to you.

In the same email, titled “Honest Thoughts,” Sutskever and Brockman also expressed concerns about Altman’s desire to become CEO and whether he was motivated by “political goals.” Altman eventually made it to CEO, and he remains that way, except for a period last year when he was laid off. then reinstated a few days later, after the replacement of the board of directors who ousted him.

OpenAI published these messages Friday in a blog post intended to show its side of the story, particularly Elon Musk’s early support for the idea of ​​making OpenAI a for-profit company so it could collect funds for the hardware and computing power that AI needs.

It was Musk, through his wealth manager Jared Birchall, who first registered “Open Artificial Intelligence Technologies, Inc.”, a public benefit corporation, in September 2017. Then came the “Honest Thoughts” email that Musk described as the “straw that broke the camel’s back.” »

“Either you do something on your own or you continue with OpenAI as a non-profit organization,” Musk responded. OpenAI said Musk then proposed merging the startup with Tesla before resigning as co-chairman of OpenAI’s board of directors in early 2018.

Musk did not respond to emailed requests for comment to his companies on Friday.

Asked about his strained relationship with Musk at a New York Times conference last week, Altman said he felt “extremely sad” but also called Musk’s legal fight a business competition issue.

“He’s a competitor and we’re doing well,” Altman said. He also told the conference that he “not so worried” on the Tesla CEO’s influence with President-elect Donald Trump. OpenAI said Friday that Altman plans to make a personal donation of $1 million to Trump’s inauguration fund, joining a number of tech companies and executives working to improve their relationship with the new administration.

——————————

The Associated Press and OpenAI have a license and technology agreement allowing OpenAI to access part of the AP’s text archives.

___

This story has been updated to correct the name of the company registered in 2017. It was Open Artificial Intelligence Technologies, Inc., not Open Artificial Technologies Technologies, Inc.

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The use of Shadow AI tools and chatbots is prevalent in healthcare facilities.

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The integration of AI into finance is reshaping the global landscape.

January 27, 2026

Mysa secures $3.4 million funding from Blume Ventures and Piper Serica.

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