OpenAI strikes back at Musk in intensifying legal dispute

Thursday 10 April 2025 - 16:45

By: Zahouani Ilham

OpenAI strikes back at Musk in intensifying legal dispute

OpenAI has filed a countersuit against Elon Musk, alleging in federal court documents submitted in Northern California that the billionaire turned against the company after walking away from it years before its landmark success with ChatGPT.

The lawsuit describes Musk as unable to accept the company’s rise after he had declared it destined to fail. OpenAI claims that Musk has since made it his mission to destroy the organization and build a rival company for his own benefit, rather than for the good of humanity.

In 2023, Musk launched xAI, a competing generative AI firm, investing tens of billions of dollars to challenge OpenAI and other major players in the field.

OpenAI, founded in 2015 as a nonprofit, was originally backed by Musk and Sam Altman, with the mission of ensuring artificial general intelligence (AGI) would benefit all of humanity. However, the company says Musk's involvement ended in 2018 after it refused to give him full control or merge with his car company, Tesla. Despite promising $1 billion in funding, OpenAI claims Musk only delivered a fraction of that amount.

Today, OpenAI is valued at $300 billion following a record-breaking $40 billion funding round. The countersuit accuses Musk of attacking the company through negative media campaigns and misleading posts to his 200 million followers on X, the platform he owns. It also accuses him of launching a fake bid for the company's assets.

The feud has intensified as OpenAI plans a restructuring to become a public benefit corporation while retaining its nonprofit parent, a move Musk allegedly misrepresents as a shift to a fully for-profit model.

OpenAI is now seeking legal measures to stop Musk’s actions and is requesting compensation for the damage caused.