Elon Musk targets OpenAI’s for-profit transition

In a recent legal development, Elon Musk’s legal team has filed a motion requesting a preliminary injunction against OpenAI to prevent its transition to a for-profit entity. This motion also seeks to halt alleged practices that Musk’s attorneys claim violate US antitrust laws, as reported by TechCrunch.

The legal team argues that OpenAI’s CEO, Sam Altman, engaged in self-dealing, potentially leaving the organization without sufficient funds to pay damages if Musk prevails in the lawsuit. This motion comes in response to reports of OpenAI’s plans to shift towards a for-profit model and its discussions with regulators regarding this structural change.

Regarding antitrust allegations, Musk’s legal team asserts that OpenAI and Microsoft discouraged investors from supporting their mutual competitors, potentially violating the Sherman Act. They also claim that Musk confirmed a major investor previously involved in an xAI funding round has chosen not to invest further in xAI.

Furthermore, the legal team alleges that OpenAI benefited from obtaining competitively sensitive information through Microsoft connections, which they argue violates the Clayton Act. They claim that Microsoft’s board seat at OpenAI, held by VP Dee Templeton, was used to coordinate business decisions between the two entities.

In response to these allegations, OpenAI spokeswoman Hannah Wong stated in an email to The Verge that Elon Musk’s legal actions lack merit and simply reiterate baseless complaints.

Update November 30th: Added statement from OpenAI spokeswoman Hannah Wong.

Credit: www.theverge.com