Elon Musk loses court battle against OpenAI

A California jury on Monday found OpenAI co-founders CEO Sam Altman and president Greg Brockman not liable for having allegedly unjustly enriched themselves by turning the once nonprofit company into a for-profit business, because Musk filed the suit outside the statute of limitations.

Tesla CEO and fellow co-founder Elon Musk initially sued the pair, as well as OpenAI and Microsoft, one of the company’s biggest backers, claiming he had donated money to the startup to help get it off the ground with the understanding that it would remain a nonprofit.

Judge Yvonne Gonzalez Rogers of the US District Court for the Northern District of California said she accepts the jury's verdict, confirming Musk's loss.

Musk indicated that he will appeal the verdict to the 9th Circuit US Court of Appeals in a post to his social media site X, describing the outcome as a “calendar technicality”, rather than a ruling on the merits of the case.

During the three-week trial, Musk’s lawyers worked to paint Altman as deceitful and untrustworthy. Musk attorney Steven Molo flatly asked Altman under cross-examination whether he thought he was truthful and if he had ever misled the people he works with.

Molo also repeatedly referenced Altman’s ouster from the OpenAI board in 2023. At the time, the board said Altman wasn’t consistently candid with its members. He was reappointed to the position just days later.

“Sam Altman’s credibility is directly at issue in this case … If you cannot trust him, if you don’t believe him, they cannot win. It’s that simple,” Molo told jurors during his closing arguments.

Molo similarly called out Brockman’s responses under cross-examination, criticizing the OpenAI president’s answers as indirect and rambling.

OpenAI’s attorneys, however, said that Musk brought his legal claims past the statute of limitations and that multiple witnesses testified that Musk didn’t condition his donations on keeping OpenAI a nonprofit organization.

The AI startup is in an all-out race to go public before rival Anthropic, which is also rumored to be planning its initial public offering by the end of 2026, expected to be a blowout year for AI IPOs.

Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X at @DanielHowley.

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