OpenAI hits back at Elon Musk lawsuit, says he suggested for-profit entity

OpenAI is pushing back against Elon Musk’s latest attempt to rework his lawsuit against the artificial intelligence (AI) giant that seeks to prevent the company from moving to a for-profit structure, noting in a blog post and legal filing that Musk had argued for it to do so years ago.

Musk, who co-founded OpenAI in 2015 along with company CEO Sam Altman, Ilya Sutskever, Greg Brockman and others, split from the company in early 2018 after failing to secure control over the company as its majority shareholder and CEO and later attempting to convince its founders to merge it with Tesla. Musk founded xAI, a competitor to OpenAI, in March 2023. 

In March 2024, Musk filed a lawsuit against OpenAI that argued it breached its founding mission as a not-for-profit company by creating a for-profit structure. OpenAI has pushed back on that lawsuit, which was withdrawn and refiled over the summer, and outlined Musk’s past agreement with a for-profit structure in a new blog post and legal filing.

OpenAI noted that in email conversations with other co-founders, Elon Musk questioned whether there should be a nonprofit structure before the company was announced in November 2015 and wrote in an email that the “structure doesn’t seem optimal … Probably better to have a standard C corp with a parallel nonprofit.”

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Elon Musk, a co-founder of OpenAI who later resigned from the AI startup, wanted to control a for-profit OpenAI entity before he opposed it, OpenAI argues. (Frederic J. Brown/AFP via Getty Images / Getty Images)

In July 2017, Musk and the OpenAI founders were discussing the company’s next steps and a message from Brockman to Zilis, who was acting as a liaison between Musk and OpenAI, detailing notes from a meeting with Musk in which they discussed OpenAI potentially changing the structure to for-profit. 

Brockman said in the message the meeting with Musk “turned into talking about structure (he said non-profit was def the right one early on, may not be the right one now – ilya and I agree with this for a number of reasons).”

Progress made in advancing OpenAI’s technology in August 2017 prompted Musk to suggest that it was “time to make the next step for OpenAI. This is the triggering event.” It was a reference to an email from Brockman that suggested an OpenAI for-profit would launch in 2018. 

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OpenAI CEO and co-founder Sam Altman was among the AI startup’s leaders who disagreed with Musk controlling the company. (Reuters/Lucy Nicholson/File Photo / Reuters Photos)

FOX Business learned from OpenAI’s legal team that Musk then instructed his wealth manager in September 2017 to create a public benefit corporation called Open Artificial Intelligence Technologies…