Musk loses suit against OpenAI

Elon Musk lost his latest courtroom fight with OpenAI on Monday after a federal jury found he had waited too long to sue, and U.S. District Judge Yvonne Gonzalez Rogers dismissed his claims. The lawsuit had accused OpenAI, Chief Executive Sam Altman and President Greg Brockman of abandoning the nonprofit mission Musk says they originally shared. The nine-person jury served in an advisory role and unanimously backed OpenAI on the statute-of-limitations question, according to multiple reports. Musk said after the verdict that he would appeal. The ruling removed one legal threat hanging over OpenAI, but it arrived less than two weeks after Canadian privacy regulators concluded the company’s early ChatGPT development and training practices violated federal and provincial privacy laws. The May 6 findings came from a joint investigation by the Office of the Privacy Commissioner of Canada and privacy authorities in Quebec, British Columbia and Alberta. The regulators said OpenAI collected, used and disclosed personal information for inappropriate purposes, failed to obtain valid consent in key circumstances and fell short on access, correction and retention obligations. (apnews.com) ### Why did Musk lose in court instead of winning or losing on the merits? Monday’s verdict turned on timing, not on whether OpenAI had in fact strayed from its founding mission. The jury found Musk’s claims were barred by the applicable statutes of limitations, and Gonzalez Rogers accepted that recommendation in court. AP reported the judge dismissed the claims after the jury sided with OpenAI and its executives. (priv.gc.ca) Musk said on X that “the judge & jury never actually ruled on the merits of the case, just on a calendar technicality,” according to MIT Technology Review and other reports. Business Insider reported that Musk also said there was “no question” Altman and Brockman had enriched themselves. ### Who was on the other side of Musk’s case? OpenAI and two of its top executives — Altman and Brockman — were the main defendants in the case. (apnews.com) Musk had argued that the company betrayed its original purpose as a nonprofit focused on developing artificial intelligence for the benefit of humanity. AP said the case centered on Musk’s claim that OpenAI abandoned that shared vision after he helped found the organization. (technologyreview.com) CBS News reported the jury was made up of nine people and acted in an advisory capacity. That detail mattered because Gonzalez Rogers, not the jury alone, entered the dismissal after accepting the panel’s recommendation. ### What exactly did Canadian regulators say OpenAI did wrong? Canada’s privacy commissioner and three provincial counterparts published their joint findings on May 6. (apnews.com) The report examined OpenAI OpCo, LLC under the federal Personal Information Protection and Electronic Documents Act, Quebec’s private-sector privacy law, and the personal information protection laws in British Columbia and Alberta. (cbsnews.com) The regulators concluded OpenAI was not compliant in several areas tied to ChatGPT 3.5 and ChatGPT 4 as they existed in 2023. The findings said the company overcollected personal information, used personal information without valid consent in some circumstances, was not sufficiently open about its models, and did not provide adequate mechanisms for access, correction and deletion. Privacy Commissioner Philippe Dufresne said OpenAI “launched ChatGPT without having fully addressed known privacy issues,” as quoted by IAPP. (priv.gc.ca) ### Did Canadian regulators order OpenAI to shut down ChatGPT? The Canadian findings did not announce a shutdown order. The regulators instead issued recommendations and said OpenAI had agreed to implement further measures after the investigation. Dufresne said his office would continue monitoring the company to ensure it kept limiting the privacy impact of its tools. The Globe and Mail reported regulators said OpenAI had already addressed some major concerns, even as they found the company had broken the law in earlier stages of development. (priv.gc.ca) Alberta’s privacy commissioner separately said the company failed consent requirements when it used personal information scraped from publicly accessible websites to develop some ChatGPT models. (priv.gc.ca) ### What happens next for Musk and for OpenAI? Musk’s next step is an appeal. He said that directly after Monday’s verdict, and reports published the same day said he planned to challenge the dismissal. OpenAI’s next steps in Canada are more administrative. The joint findings say the company agreed to additional corrective measures, and the privacy commissioner said his office would keep monitoring compliance. (theglobeandmail.com) The formal report and the commissioner’s May 6 statement set out the recommendations and the agencies involved in that process. (priv.gc.ca) (businessinsider.com)