Elon Musk Sues OpenAI: Accuses It of “Stealing Creativity” and Demands Restoration of Its Nonprofit Status

On April 28, local time, the Elon Musk vs. OpenAI case entered the witness testimony stage, with Musk and OpenAI CEO Sam Altman both appearing in court. The case centers on the legality of OpenAI’s transition from a nonprofit to a for-profit company, drawing intense attention from the global tech community and the public.

As early as the end of 2015, Musk and Altman jointly founded the nonprofit, open-source OpenAI with the goal of “making general artificial intelligence benefit humanity,” with Musk serving as co-chair and providing roughly $38 million in early donations, making him a key funding backer.

But by 2018, AI R&D costs surged, and Altman argued for introducing capital and commercializing the company—clashing with Musk’s view opposing technology being led by capital.

In February of that year, Musk proposed that OpenAI be merged into Tesla to share data and funding, but Altman rejected the proposal, further escalating tensions. Musk stepped down from his position on the board and left day-to-day operations.

In 2019, OpenAI reorganized, setting up a for-profit subsidiary with a “profit cap,” and received a $1 billion investment from Microsoft, entering into close cooperation. After that, OpenAI’s commercialization accelerated; the explosive success of ChatGPT caused its valuation to skyrocket. In 2023, Microsoft made an additional investment of $10 billion, bringing its stake to 49%.

In July 2023, Musk launched his own AI company, xAI, and the large model Grok, formally moving into competition with OpenAI.

By 2024, Musk took further action: he formally filed a lawsuit against Altman and co-founder Greg Brockman, and also named Microsoft—OpenAI’s largest investor—as a co-defendant.

During the trial, Musk said the lawsuit was to protect charitable organizations. He believes Altman and others turned OpenAI from a nonprofit into a “wealth machine” to profit themselves and their investors, which he says goes against their original intentions.

Musk said that the idea and the name of OpenAI were his, that the key personnel were recruited by him, and that the startup funding was provided by him as well, with the original intent of doing charity; the company should not be allowed to profit.

He demands that OpenAI restore its nonprofit status, remove executives including Altman, and order its largest investor, Microsoft, to pay $150 billion in damages; however, the compensation would be paid into an account of the charitable organization affiliated with OpenAI.

Meanwhile, the defense argues that this move is intended to suppress #OpenAI and pave the way for Musk’s xAI project. No matter the outcome, this legal battle is set to become a landmark showdown in the history of AI development.