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2mo ago

Judge Denies Musk's Bid to Block OpenAI's For-Profit Transition

The court rejected Musk's request for an injunction but expedited a trial to address his claims about OpenAI's nonprofit origins and its shift to a for-profit model.

OpenAI CEO Sam Altman speaks at an event in Tokyo on Feb. 3, 2025.
Elon Musk, chief executive officer of Tesla Inc., walks to the Eisenhower Executive Office Building (EEOB) near the White House in Washington, DC, US, on Thursday, Feb. 13, 2025. US President Donald Trump has gravitated toward the reciprocal tariff plan as a key part of his push to raise US levies overall, stating it would apply to nations who generally have a higher average tariff rate than the US, which would raise its own tariff to match them. Photographer: Stefani Reynolds/Bloomberg
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Overview

  • U.S. District Judge Yvonne Gonzalez Rogers ruled that Musk failed to meet the burden of proof for a preliminary injunction to halt OpenAI's transition to a for-profit structure.
  • The judge offered to fast-track a trial for fall 2025 to address Musk's claims, citing the public interest and potential legal implications of OpenAI's restructuring.
  • Musk alleges that OpenAI's shift violates the terms of his initial $45 million donation, which he claims was contingent on the organization remaining nonprofit.
  • OpenAI's leadership, including CEO Sam Altman, denies Musk's allegations, arguing that the lawsuit is motivated by competition with Musk's rival AI company, xAI.
  • The legal battle highlights broader tensions in the AI industry over governance, funding, and the balance between public benefit and profitability.