OAKLAND, Calif. — One of the biggest trials in tech is underway, and it did not take long for the accusations to start flying.
Tech mogul Elon Musk took the stand Tuesday in the first day of testimony for his lawsuit against OpenAI CEO Sam Altman, claiming Altman, his onetime associate, had betrayed the altruistic principles the AI company they co-founded was built on.
Musk also took much of the credit for OpenAI's creation.
“I came up with the idea, name, recruited the key people, provided the funding,” he said in court. “I could have started it as a for-profit, and I chose not to.”
The outcome of the trial could determine the future of OpenAI, which was founded as a nonprofit operation in 2015. Musk, who left the board of OpenAI, which makes ChatGPT, in 2018, seeks to stop it from becoming a for-profit company — having publicly accused OpenAI of having become a “closed source, profit-maximizer.”
Musk said in court, "If the verdict comes out that it’s OK to loot a charity, charitable giving in America will be destroyed.”
The remark drew an immediate objection from OpenAI's lawyers.
Musk described his initial discussions with Altman to make OpenAI a charity, saying they decided that surplus earnings would go into the organization’s cash reserves and that it would remain an independent 501(c)(3) tax-exempt organization.
According to Musk, corporate founding documents said that “no person shall benefit from this charity.”
The lawsuit is the culmination of Musk’s long-standing feud with Altman, which had been simmering even before they became rival tech executives in the AI space. Both were in the courtroom for the first day of arguments Tuesday, although Altman left before Musk took the stand.
Jury selection wrapped up Monday for the trial, which is scheduled to run for four weeks. Witnesses are expected to include not only Musk, the CEO of xAI, Tesla and SpaceX, and Altman, the CEO of OpenAI, but possibly also Microsoft CEO Satya Nadella, top AI researchers and current and former OpenAI board members.
OpenAI completed its restructuring in October. Its reimagined for-profit entity, which continues to be controlled by a nonprofit foundation, removed its profit cap and later raised $122 billion in its latest funding round.
Musk has claimed in his lawsuit against Altman that OpenAI’s transformation “requires lying to donors, lying to members, lying to markets, lying to regulators, and lying to the public.”
Musk, who claims OpenAI benefited from his money, advice, recruiting efforts and connections, is seeking an estimated $134 billion in damages from OpenAI and Microsoft, one of OpenAI’s top backers and a co-defendant in the case.
Altman’s side, meanwhile, has claimed that Musk never gave OpenAI the $1 billion he’d promised, alleging that Musk quit when Altman and fellow co-founders Greg Brockman and Ilya Sutskever refused to “bow to Musk’s demands for control of the enterprise or, alternatively, its absorption into Musk’s electric car company, Tesla.”
“ChatGPT drew a new spotlight onto OpenAI,” Altman’s lawyers wrote in a counterclaim, citing the 2022 explosion of generative AI that was driven by the launch of ChatGPT. “Musk had nothing to do with it.”
OpenAI attorney Bill Savitt began his opening statement Tuesday by lambasting Musk, saying he used his $1 billion commitment to “bully” fellow members of the founding team. He argued that “we’re here because Mr. Musk didn’t get his way at OpenAI.”
“Musk never cared whether OpenAI was a not-for-profit. ... He never cared about AI safety,” Savitt said. “What he cared about was Elon Musk on top.”
Musk testified that the discussion of creating a for-profit entity did come up. But he said he envisioned that any profit would flow to the nonprofit entity.
"We discussed, brainstormed about different ways to fund the charity. We did talk about establishing a for-profit or Tesla providing the funding," Musk said. "As long as the tail didn’t wag the dog, essentially."
Musk's testimony is expected to continue Wednesday.
Shanshan Dong reported from Oakland and Angela Yang from Los Angeles.
