Did OpenAI mislead Elon Musk by taking his cash as a non-profit and later shifting to a for-profit mannequin? It’s the query that sits on the centre of what’s shaping as much as be certainly one of Silicon Valley’s messiest authorized battles that’s now undoubtedly headed to courtroom.
In his 2024 lawsuit towards OpenAI, Musk alleged that the ChatGPT maker and its leaders had deserted the corporate’s authentic non-profit mission that he funded. On Thursday, January 15, US District Choose Yvonne Gonzalez Rogers dominated that the case warranted going to trial based mostly on proof akin to a whole lot of just lately unsealed courtroom paperwork.
“A part of that is about whether or not a jury believes the individuals who will testify and whether or not they’re credible,” the choose mentioned in courtroom, whereas dismissing OpenAI and Microsoft’s last-ditch efforts to have Musk’s lawsuit thrown out. The case will probably be heard as a jury trial in a Northern California federal courtroom from April 27 onwards.
Based mostly on what has already come to mild, the high-stakes trial is prone to floor contemporary and interesting particulars in regards to the AI juggernaut’s early days in addition to the circumstances surrounding CEO Sam Altman’s temporary ouster and Microsoft’s complicated relationship with OpenAI.
Over the previous week, each OpenAI and Elon Musk have tried to sway the courtroom of public opinion, utilizing the newly unsealed proof to argue over what precisely occurred when Musk break up methods with the AI startup he helped co-found. Right here’s a take a look at what the unsealed courtroom paperwork reveal, what OpenAI says has been omitted, and what lies forward within the courtroom showdown set for April this 12 months.
What do the unsealed courtroom paperwork reveal?
Greater than 100 paperwork associated to Musk’s lawsuit towards OpenAI had been unsealed final week. Obtained throughout the discovery course of, the paperwork comprise hundreds of pages of proof together with depositions from key gamers concerned within the case akin to Sam Altman, Greg Brockman, Ilya Sutskever, Mira Murati, and Satya Nadella, together with Helen Toner and Tasha McCauley, ex-OpenAI board members who reportedly performed a task within the firing of Altman in 2023.
Whereas bits and items of the paperwork have been doing the rounds on social media, a diary entry by Greg Brockman, OpenAI’s president, has drawn specific consideration as he seems to precise doubts about pushing Musk out of OpenAI and committing to a non-profit-only entity.
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“Some probability that rejecting Elon will really lose us Sam. We’ll discover out tomorrow if doing an override right through is palettable. That is the one probability now we have to get out from Elon. Is he the ‘superb chief’ that I’d choose?” the diary learn. In a separate entry, Brockman wrote, “All of it comes all the way down to the cash. We are able to get it from Tesla, in all probability. We may additionally in all probability get it from Google,” he wrote.
“Can not say that we’re dedicated to the non-profit. Don’t need to say that we’re dedicated. If three months later we’re doing b-corp then it was a lie,” one other entry learn. Brockman additionally wrote in his diary that he needed to be a billionaire.
His diary entries had been cited by Choose Rogers in her current determination that Musk had sufficient proof that he had been misled to take the case to trial.
The paperwork have additionally introduced different info to mild. As an illustration, Nadella was frightened about Microsoft’s place within the AI race when he began OpenAI. In 2022, Sutskever and Murati appeared involved in regards to the prominence of open-source lab Stability AI. OpenAI’s leaders additionally thought-about prohibiting traders from backing competing labs.
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Microsoft edged out Amazon in securing an early partnership with OpenAI as a result of Musk was against working with Jeff Bezos. “I feel Jeff is a little bit of a software and Satya will not be, so I barely want Microsoft, however I hate their advertising and marketing dept,” he wrote in an electronic mail to Altman.
What has OpenAI mentioned is lacking from Musk’s claims?
Musk has been utilizing the just lately unsealed courtroom paperwork to assault OpenAI and its leaders in posts on X. “They freely talk about their conspiracy to commit fraud and steal the charity,” he wrote. “They stole a charity, plain and easy,” Musk mentioned in reply to a different put up about Brockman’s diary entries.
They freely talk about their conspiracy to commit fraud and steal the charity https://t.co/AI6oFll2yV
— Elon Musk (@elonmusk) January 16, 2026
Musk’s argument boils all the way down to the unsealed proof clearly exhibiting that OpenAI’s management knew about plans to go for-profit properly earlier than they introduced the intention publicly, and that Musk and different stakeholders had been intentionally misled.
In response, OpenAI accused Musk of cherry-picking snippets from Greg Brockman’s personal journal entries. Its core argument is that Musk himself needed OpenAI to be a for-profit within the early days.
“Elon mentioned he needed to build up $80B for a self-sustaining metropolis on Mars, and that he wanted and deserved majority fairness. He mentioned that he wanted full management since he’d been burned by not having it up to now, and after we mentioned succession he shocked us by speaking about his kids controlling AGI,” OpenAI mentioned in a weblog put up titled ‘The reality Elon unnoticed’ printed on Friday, January 16.
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What’s the backstory to the Musk-OpenAI feud?
In 2015, Musk and Altman co-founded OpenAI with a number of others as a non-profit with lofty charitable targets akin to creating AGI for the good thing about humanity. They needed to make sure Google, which had an enormous lead in creating the expertise, didn’t find yourself deciding what it could imply for the human race, in response to a report by The Wall Avenue Journal.
Nevertheless, by 2017, cracks began appearing within the bond between Musk and Altman. Finally, Musk left OpenAI’s board and began his personal AI enterprise referred to as xAI in 2023. Since its founding, OpenAI operated as a non-profit-controlled organisation with a for-profit working arm.
In 2023, the non-profit board fired Sam Altman after concluding that he was “not constantly candid in his communications with the board.” Days later, he was employed by Microsoft to steer a brand new AI initiative. However when almost all of OpenAI’s remaining employees threatened to give up, Altman was reinstated as OpenAI’s CEO and the board changed.
A 12 months later, OpenAI proposed to eliminate the non-profit’s oversight and develop into a for-profit public profit company (PBC). After dealing with backlash from advocacy teams, OpenAI later backtracked and mentioned the non-profit will management and likewise be a big shareholder of the PBC.
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In October 2025, OpenAI accomplished its transition to a for-profit PBC. Musk had initially sued OpenAI in a California state courtroom. He withdrew the California swimsuit in June 2025, then filed a federal swimsuit in August 2025. “The perfidy and deceit are of Shakespearean proportions,” his legal professionals wrote.
What occurs subsequent?
Within the April trial, the jury will resolve whether or not OpenAI broke its non-profit commitments to Musk. It should additionally resolve whether or not Microsoft knowingly helped OpenAI break its guarantees.
As for punitive damages and different penalties, Musk is searching for as much as $134 billion from OpenAI and Microsoft for the “wrongful features” that they acquired from his early assist, in response to a courtroom submitting on Friday. The tech billionaire mentioned that he had donated $38 million, 60 per cent of OpenAI’s early seed funding, which finally helped the AI startup achieve between $65.5 billion and $109.4 billion. He additionally alleged that Microsoft had gained between $13.3 billion and $25.1 billion because of his contributions, as per the federal courtroom submitting.
Musk additional mentioned that he had helped OpenAI by recruiting employees, connecting the founders together with his contacts, and lending credibility to the startup when it was based.
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“With out Elon Musk, there’d be no OpenAI. He offered the majority of the seed funding, lent his repute, and taught all of them he is aware of about scaling a enterprise. A pre-eminent knowledgeable quantified the worth of that,” Musk’s lead trial lawyer Steven Molo was quoted as saying by Reuters.
In response, OpenAI and Microsoft submitted their very own filings, asking the choose to restrict what Musk’s knowledgeable could current to jurors. They argued that the evaluation must be excluded as “made up,” “unverifiable” and “unprecedented” and as searching for an “implausible” switch of billions from a non-profit to a former donor-turned-competitor.