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ELON MUSK PURSUES LAWSUIT AGAINST OPENAI DESPITE NONPROFIT CONTROL DECISION
AppleMagazine
|May 09, 2025
Elon Musk will proceed with his lawsuit against OpenAl and its CEO, Sam Altman, despite the company’s decision to maintain nonprofit control over its operations, according to a statement from Musk’s lawyer, Marc Toberoff, reported this week.
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The legal action, filed in 2024, accuses OpenAl of breaching its founding mission to develop artificial intelligence for humanity’s benefit by pursuing a for-profit model.
For OpenAl's users, investors, and the Al industry, the ongoing dispute highlights tensions between the company’s nonprofit roots and its commercial ambitions, with Musk alleging OpenAl prioritizes profits for Altman, investors, and Microsoft.
OpenAl, which operates ChatGPT with 320 million monthly users, announced it would retain nonprofit governance, reversing a plan to become a fully for-profit entity, following pressure from Musk, former employees, and civic leaders.
The nonprofit will oversee a restructured public benefit corporation (PBC), holding a significant equity stake to fund its mission. Toberoff criticized the arrangement, claiming it obscures details and fails to address OpenAl's shift toward closed-source Al development.
The lawsuit, set for a jury trial in March 2026, reflects broader debates about Al governance as OpenAl navigates a $40 billion funding round and regulatory scrutiny.
MUSK'S LEGAL CLAIMS AND MOTIVATIONS
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