The most consequential AI lawsuit in years just kicked off in an Oakland courtroom.
Elon Musk's case against OpenAI, Sam Altman, and Microsoft started Monday in the U.S. District Court for the Northern District of California, with Judge Yvonne Gonzalez Rogers on the bench. Jury selection began Monday, with opening arguments expected Tuesday and both Musk and Altman slated to take the stand.
The damages number is eye-popping at up to $134 billion. But the more interesting ask is structural.
Musk wants the court to:
If the judge agrees with all of that, it would reshape the most valuable AI company in the world.
OpenAI now claims nearly 1 billion weekly active users, up sharply since ChatGPT launched in late 2022. The company is worth $852 billion after closing a record $122 billion funding round in late March, with the Wall Street Journal reporting a possible IPO later this year.
OpenAI was created in 2015 by Musk, Altman, and a small group of co-founders. The mission was to build AI "to benefit humanity," free from shareholder pressure.
By 2019, the company had spun up a for-profit subsidiary, with leadership arguing it was the only way to attract the kind of capital needed to compete on AI compute and chips.
Musk had already exited OpenAI's board in 2018, with the company pointing to possible conflicts with his Tesla role at the time. Musk launched his own AI venture, xAI, in 2023.
OpenAI's lawyers argue Musk's lawsuit is competitive interference dressed up as principle, calling it a "harassment campaign." Musk's lawyers used different language, writing in court filings that "the perfidy and deceit are of Shakespearean proportions" and that Altman ran a "long con."
The case is expected to run two to three weeks, with both sides expected to call their CEOs to testify. Of the 26 claims Musk filed in 2024, only two remain after pre-trial pruning: unjust enrichment and breach of charitable trust.
UPenn Law professor Jill Fisch says the underlying question matters far beyond OpenAI. When a company tells investors it's going to operate one way and then pivots, are there limits to how far it can go?
For investors, the answer could change how a generation of mission-driven startups gets built and funded. The ruling could also affect AI rivals like Anthropic and xAI, which use different corporate structures designed to balance mission and capital.
A win for Musk could also slow OpenAI's IPO timeline, currently targeted by some reports for later this year.
The courtroom drama will get the headlines, but the real signal is the remedy. A money-only ruling barely changes the AI landscape.
A structural unwind changes everything.
A trial that could unwind an $852 billion company starts today.
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