OpenAI defeats Musk suit

A federal jury in Oakland, California, on May 18 rejected Elon Musk’s lawsuit against OpenAI, ending a closely watched trial over whether the ChatGPT maker abandoned its nonprofit roots. Jurors found Musk had waited too long to sue, and U.S. District Judge Yvonne Gonzalez Rogers accepted the advisory verdict and dismissed the claims. Musk had accused OpenAI, Chief Executive Sam Altman and President Greg Brockman of betraying a founding commitment to develop artificial intelligence for the public good. Musk said after the ruling that he would appeal. ### Why did Musk lose if the case was about OpenAI’s mission? The jury’s answer was procedural, not substantive. Reuters and the Associated Press reported that the unanimous verdict found Musk’s claims were barred because he filed too late under the applicable statute of limitations. The nine-person jury deliberated for less than two hours after a three-week trial. (usnews.com) Judge Gonzalez Rogers said in court that Musk could face a difficult appeal because the timing issue turned on facts the jury had already weighed. She said there was “a substantial amount of evidence” supporting the finding that the filing deadline had passed, according to Reuters. ### What was Musk accusing Altman and OpenAI of doing? (usnews.com) Musk’s lawsuit said OpenAI and its leaders induced him to contribute early funding and then shifted the organization toward commercial gain. Reuters reported that Musk said Altman and Brockman went behind his back by attaching a for-profit business to the original nonprofit and later taking tens of billions of dollars from Microsoft and other investors. (usnews.com) Musk had invested $38 million in OpenAI’s early years, according to Reuters and AP. OpenAI answered that there was never any agreement to remain a nonprofit forever. AP reported that the company argued Musk knew about the possibility of a for-profit structure and later sued because he did not have unilateral control over the company. OpenAI also said the case was part of a business rivalry tied to Musk’s own AI company, xAI. (usnews.com) ### What did the trial show about the break between Musk and Altman? OpenAI was founded in 2015 by Altman, Musk and others, and Musk left its board in 2018. Reuters reported that OpenAI created a for-profit arm the following year. The Oakland trial focused less on technical AI questions than on the company’s founding conversations, internal decisions and the deterioration of the relationship between Musk and Altman. (pbs.org) William Savitt, a lawyer for OpenAI, told reporters after the verdict that jurors had concluded the suit was an “after-the-fact contrivance,” according to AP. Musk, posting on X, said the court had ruled only on “a calendar technicality” and not on the underlying merits. ### Why was this case being watched so closely? (usnews.com) OpenAI’s size made the outcome matter beyond the two men. AP reported that the company is valued at $852 billion and is moving toward what could be one of the largest initial public offerings in history. Reuters separately reported that the verdict cleared the path for a possible IPO that could value the company at $1 trillion. Those figures came from the companies and outlets’ reporting, and together they show how central the lawsuit had become to OpenAI’s corporate plans. (pbs.org) Marc Toberoff, a lawyer for Musk, said the verdict could embolden startups that begin as nonprofits and later create for-profit entities that enrich executives, Reuters reported. OpenAI did not present the ruling that way; its lawyers said the case reflected Musk’s effort to damage a competitor. (usnews.com) ### What happens next in court and at OpenAI? Musk said on May 18 that he would appeal to the 9th U.S. Circuit Court of Appeals. Reuters and AP both reported that he continued to accuse Altman and Brockman of enriching themselves through OpenAI. OpenAI now moves ahead without this trial hanging over its plans. (usnews.com) The next concrete step is any appeal filing by Musk’s legal team in the 9th Circuit, while investors and bankers watch whether OpenAI proceeds with an IPO process later in 2026.