By Milcah Tanimu
Elon Musk has intensified his legal battle against OpenAI, seeking a U.S. court injunction to halt the company’s transition to a for-profit structure. Musk claims the move is illegal and poses a threat to market competition, particularly to his own AI startup, xAI.
In his court filings, Musk accuses OpenAI and CEO Sam Altman of straying from their original nonprofit mission. He alleges the company’s shift toward a for-profit model, especially after receiving billions from Microsoft, undermines the societal benefit it once aimed to provide.
Musk’s legal team argues that OpenAI is becoming monopolistic and has entered into potentially illegal agreements that may restrict funding for competing AI ventures. He claims this is harmful to innovation and competition.
In response, OpenAI dismissed Musk’s claims, calling them baseless and reiterating its commitment to innovation and transparency. The company is also reportedly discussing its corporate restructuring with California’s Attorney General.
This is Musk’s third attempt to challenge OpenAI’s for-profit direction. He initially filed a lawsuit in 2024, withdrew it, and refiled in federal court later in the year. Musk is also challenging OpenAI’s exclusive agreements with investors, accusing them of being anti-competitive.
While focusing on his legal fight with OpenAI, Musk’s AI startup, xAI, continues to grow. Launched in 2023, xAI’s valuation recently reached $50 billion, more than doubling since May 2024.
OpenAI’s shift to a for-profit model, originally initiated in 2019, raised questions about its commitment to societal benefit. Despite concerns, the nonprofit board assures it will remain integral to any restructured entity, ensuring value for its stake in the for-profit arm.
