Jury rules against Musk saying he filed lawsuit too late in his feud with OpenAI

A federal jury on Monday sided with OpenAI and its top executives in a feud with Elon Musk, who accused them of betraying a shared vision for it to guide artificial intelligence’s development as a nonprofit dedicated to humanity’s benefit.

Mr Musk, the world’s richest man, was a co-founder of OpenAI, the company that launched in 2015 and went on to create ChatGPT.

After investing 38 million dollars (£28m) in its first years, Mr Musk accused OpenAI chief executive Sam Altman and his top deputy of shifting into a moneymaking mode behind his back.

The nine-person jury found that Mr Musk waited too long to file his lawsuit and missed the deadline for the statute of limitations.

The jury served in an advisory role, but Judge Yvonne Gonzalez Rogers accepted the verdict on Monday as the court’s own and dismissed Mr Musk’s claims. The jury deliberated for two hours before returning its verdict.

Mr Musk’s lawyer, Steven Molo, said they will file in an appeal and Mr Musk’s feud with OpenAI was far from resolved.

He compared the loss to moments in US history such as the Siege of Charleston and the Battle of Bunker Hill which were “major losses for Americans, but who won the war?

“And this one is not over, and to sum it up in one word: appeal.”

Bill Savitt, a lawyer for OpenAI, speaks to the media after the ruling PA Media

Outside court, OpenAI lawyer William Savitt told reporters that jurors determined the lawsuit was an “after-the-fact contrivance” that amounted to Mr Musk trying to sabotage a competitor and “to overcome a long history of very bad predictions about what OpenAI has been and will become”.

Microsoft, an OpenAI investor and a co-defendant in Mr Musk’s lawsuit, said it welcomed the decision and remains “committed to our work with OpenAI to advance and scale AI for people and organisations around the world”.

The trial that began April 27 in Oakland, California shed light on the bitter falling-out between the two Silicon Valley titans and the beginnings of OpenAI, now a company valued at 852 billion dollars (£634 billion) and moving towards potentially one of the largest initial public offerings in history.

Mr Altman and OpenAI claimed there was never a promise to keep OpenAI a nonprofit forever. In fact, they argued, Mr Musk knew this and filed his lawsuit because he could not have unilateral control over the fast-growing AI developer.

Mr Musk was seeking damages to be paid to the altruistic efforts of OpenAI’s charitable arm as well as Mr Altman’s ousting from OpenAI’s board.

Mr Musk’s decision to stop funding the company contributed to a bitter rift between the former allies. Mr Musk says he was responding to deceptive conduct that OpenAI’s board picked up on when it sacked Mr Altman as chief executive in 2023 before he got his job back days later.

The three-week trial heard evidence from Mr Musk, Mr Altman and his top lieutenant Greg Brockman, along with Microsoft boss Satya Nadella and a slew of others in the tech titans’ orbit.

Mr Musk told jurors on his first of three days on in the witness box that: “I think they’re going to try to make this lawsuit … very complicated, but it’s actually very simple. Which is that it’s not OK to steal a charity.”

Mr Musk’s lawsuit claimed that, in addition to “breach of charitable trust”, Mr Altman and Mr Brockman unjustly enriched themselves from the windfall as the ChatGPT maker soared in valuation.

Mr Brockman revealed during the trial that his stake in OpenAI is worth about 30 billion dollars (£22 billion).

OpenAI has brushed off Mr Musk’s allegations as an unfounded case of sour grapes aimed at undercutting its rapid growth and bolstering Mr Musk’s own xAI, which he launched in 2023 as a competitor. During cross-examination, Mr Musk was sometimes combative with OpenAI lawyer William Savitt.

“Your questions are not simple,” Mr Musk said at one point. “They are designed to trick me essentially.”

Jurors also heard from witnesses including OpenAI ex-board members Helen Toner and Tasha McCauley, who spoke about the decision to sack Mr Altman in 2023. They were ousted from the board themselves when Mr Altman returned to his role a few days later.

Mr Altman and Mr Musk both vied to be OpenAI’s chief executive in its early years.

In his evidence, Mr Altman said he had concerns about Mr Musk’s attempts to gain more control over OpenAI, which was aiming to safely build a better-than-human form of AI called artificial general intelligence.

“Part of the reason we started OpenAI is we didn’t think AGI could be under the control of any one person, no matter how good their intents are,” Mr Altman said.

Near the end of his evidence, Mr Altman said that before things turned sour, he had thought very highly of Mr Musk.

“I felt like he had abandoned us, not come through on his promises, put the company in a very difficult place, jeopardised the mission, didn’t really care about the things I thought he cared about,” Mr Altman said.

“It’s been an extremely painful thing for me … to have someone that I respected so much not acknowledge that and continue to publicly attack us.”