Tesla and X CEO Elon Musk has initiated a new lawsuit against OpenAI and its CEO Sam Altman, re-opening the legal battle in his fights over the artificial intelligence company ChatGPT.
In the lawsuit, Musk alleges that he was misled into supporting the organization under the pretense that it would remain a non-profit, accusing the company of abandoning its mission.
Musk claims that Altman and others involved in OpenAI, shifted the organization’s trajectory towards for-profit motives, contrary to their initial agreement. The lawsuit, filed in a federal court in California, accuses OpenAI of breaching various contracts and engaging in fraudulent activities, including self-dealing and forming a complex web of for-profit affiliates.
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Musk’s legal team argues that the changes in OpenAI’s structure were made without proper disclosure, which undermined the original vision of creating a safe and open AI for humanity.
The recent lawsuit is coming after Musk in March 2024, had filed a lawsuit in a San Francisco court, against OpenAI, its co-founders Sam Altman and Greg Brockman, and affiliated entities, accusing the AI organization of deviating from its original non-profit mission in favor of profit-driven endeavors. The lawsuit paints a picture of betrayal and contractual breach, alleging that OpenAI has reneged on its founding commitments to Musk and the broader public.
According to legal documents, OpenAI’s founding agreement mandated that its technological advancements be freely accessible to the public, a principle that Musk contends has been disregarded. Instead, he argues, OpenAI has transitioned into a profit-driven enterprise, particularly following its lucrative partnership with tech giant Microsoft, which has invested a substantial amount into the AI startup.The company is reportedly the biggest investor in OpenAI, having poured a whopping $13 billion into the company.
Fast-forward to June 2024, in a surprising twist of event, Musk filed a motion to dismiss the lawsuit against OpenAI and its CEO, Sam Altman. This move was seen as an end to a contentious legal battle between the co-founders of the artificial intelligence startup that began in February.
However, in a recent shocking move, Musk doesn’t seem to have let go, following the fresh lawsuit, which made the same claims as the initial one. The lawsuit alleges that he was betrayed by Altman and his accomplices. “The perfidy and deceit are of Shakespearean proportions”, Musk wrote.
The 83-page lawsuit claims OpenAI’s partnership with Microsoft flipped the narrative of the company’s original mission.
Part of the lawsuit reads,
“In partnership with Microsoft, Altman established an opaque web of for-profit OpenAI affiliates, engaged in rampant self-dealing, seized OpenAI, Inc.’s Board, and systematically drained the non-profit of its valuable technology and personnel”.
OpenAI is yet to comment on the recent lawsuit, meanwhile, responding to the initial lawsuit in March, the company refuted Musk’s claims, describing them as “incoherent” and “frivolous”, also arguing in a court filing that the case should be dismissed.
Recall that OpenAI in defense, had published several of Musk’s emails from the early days of the company that appear to show Musk acknowledging OpenAI needed to make a ton of money to fund the incredible computing resources needed to power its AI ambitions.
In the emails, parts of which have been redacted, Musk argues that the company stood virtually no chance of building a successful generative AI platform by raising cash alone, and the company needed to find alternate sources of revenue to survive. The company further maintained its stance via a blog post that it has not diverged from its mission, and it would move to dismiss all of Musk’s claims.
It is worth noting that OpenAI was initially founded as a nonprofit organization that relied on donations of approximately $130.5 million to finance its research and development. The nonprofit published its research and maintained open-source projects.
However, the company reorganized into a limited partner structure in 2019. It essentially adopted a hybrid model that combines nonprofit and for-profit elements.
Since the launch of its Artificial Intelligence chatbot, ChatGPT in 2022, the company has been making waves in the field of artificial intelligence which has seen it as a force to reckon with. As of April 2024, the company was estimated to generate more than $1 billion in annual revenue far ahead of previous estimates that it would reach $200 million.