Elon Musk has requested damages ranging from $79 billion to $134 billion from OpenAI and Microsoft in a lawsuit alleging that Sam Altman’s AI startup defrauded him by abandoning its nonprofit mission.
Bloomberg reports that Elon Musk has escalated his legal battle against OpenAI and Microsoft by formally requesting damages between $79 billion and $134 billion, claiming he was defrauded when the generative AI company moved away from its original nonprofit structure and formed a partnership with the software giant.
The damages request was outlined in a court filing submitted on Friday by Musk’s legal team, coming just one day after a federal judge denied OpenAI and Microsoft’s final attempt to avoid a jury trial. The trial is scheduled to begin in late April in Oakland, California.
According to the filing, Musk’s lawyer Steven Molo referenced calculations prepared by financial economist expert witness C. Paul Wazzan. The calculations suggest that Musk deserves a portion of OpenAI’s current $500 billion valuation, arguing that he was defrauded of the $38 million in seed funding he contributed when he co-founded the startup in 2015. Both OpenAI and Microsoft have since challenged these calculations.
Molo explained the reasoning behind the substantial damages request by drawing a comparison to early-stage investing. The lawyer noted that similar to how an early investor in a startup company might achieve gains far exceeding their initial investment, the wrongful gains that OpenAI and Microsoft have allegedly obtained are considerably larger than Musk’s original contributions.
The legal dispute stems from Musk’s claim that OpenAI breached its founding principles. Musk departed from OpenAI’s board in 2018 and subsequently launched his own artificial intelligence company in 2023. He initiated legal proceedings in 2024 against Sam Altman, OpenAI’s co-founder and chief executive officer, over plans to transition the company to a for-profit business model. Both OpenAI and Microsoft have consistently denied the allegations.
OpenAI responded to the damages request with a statement characterizing the lawsuit as baseless and part of an ongoing harassment campaign by Musk. The company stated that it looks forward to demonstrating this at trial and described the latest demand as unserious and aimed solely at furthering the harassment campaign.
Sam Altman has publicly criticized Musk’s legal challenge to OpenAI’s restructuring, calling it a weaponization of the legal system designed to slow down a competitor. OpenAI has cautioned investors to anticipate attention-grabbing claims from Musk as the legal battle progresses toward trial.
The company behind ChatGPT announced its restructuring plans in October. At that time, OpenAI revealed it had granted a 27 percent ownership stake to Microsoft, its longtime supporter, in a transition designed to maintain the startup’s nonprofit arm in control of its for-profit operations.
The filing indicated that Musk also intends to pursue punitive damages and potentially seek an injunction, though the filing did not provide details about the nature of such an injunction.
Read more at Bloomberg here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
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