Elon Musk Delivers First Testimony in OpenAI Lawsuit Against Altman and Brockman

Musk v. OpenAI Trial Begins in Oakland Federal Court

On April 28, the trial over Elon Musk's lawsuit against OpenAI and its co-founders Sam Altman and Greg Brockman commenced in federal court in Oakland, California. All three founded the company in 2015, but their visions for its future diverged dramatically over time, Bloomberg reports.

Musk contends that OpenAI's transformation from a nonprofit organization to a for-profit entity was a grave mistake that sets a dangerous precedent for similar projects.

"You can't steal from a charity, that's my opinion," the billionaire told jurors at the start of the proceedings.

According to Musk, if Altman and Brockman's actions are not found to be wrongful, "it will set a precedent for the looting of every charity in America." He is seeking to reverse the restructuring.

Why This Matters

The outcome of the three-week trial could determine OpenAI's future as the company prepares for what would be one of the largest IPOs in history. The court's decision will also set a precedent for the broader industry: whether a nonprofit organization with multi-billion-dollar assets can freely convert to a for-profit structure without all founders' consent.

Musk's Case: From Google Fears to OpenAI's Creation

Musk dedicated much of his initial testimony to recounting his business ventures — Zip2, PayPal, SpaceX, Neuralink, and Tesla. He emphasized his longstanding interest in artificial intelligence alongside deep concerns about the technology's potential. In his view, AI can both significantly advance society and lead to its destruction.

Around 2015, Musk discussed AI capabilities "with everyone" and shared his concerns. Among his interlocutors was Google co-founder Larry Page, who Musk said "wasn't paying enough attention to AI safety." At the time, Google led AI development and had "all the money, computers, and talent."

"I thought: what could be the opposite of Google? Open source, a nonprofit," Musk said.

Musk's attorney Steven Molo told jurors he would prove that Altman and Brockman leveraged the Tesla CEO's money, reputation, and guidance to launch OpenAI, then abandoned its public-benefit principles and exploited the project for personal gain. According to Molo, Microsoft became a knowing accomplice, investing $13 billion in OpenAI since 2019 — one year after Musk departed the startup's board of directors.

OpenAI's Defense: Musk Himself Pushed for Commercialization

OpenAI attorney William Savitt characterized the lawsuit as an attempt to undermine the primary competitor of Musk's own AI company, xAI. He argued that Musk himself advocated for commercial transformation during the startup's early years.

Savitt presented Musk's correspondence. During OpenAI's first year as a nonprofit research lab, Musk wrote: "Probably better to create a standard C corp with a parallel nonprofit." The following year, he stated: "Given the progress that DeepMind has made, creating OpenAI as a nonprofit might have been a mistake."

In 2017, Musk and other team members recognized the company needed significantly more funding for computational resources. After "dozens of meetings," they agreed on the need to create a commercial arm.

"During these spirited discussions in 2017, Mr. Musk never once expressed the view that OpenAI should remain exclusively a nonprofit. Quite the opposite," Savitt told the jury.

The attorney argued that Musk wanted to turn the startup into a fully commercial company and establish absolute control over it, but the other co-founders "refused to hand over control of AI development to one person."

Musk's Rebuttal and What Comes Next

On the stand, Musk countered that he was always open to creating a commercial subsidiary — provided that profits were capped and funds flowed to the nonprofit. One proposal under discussion envisioned equal distribution of equity in the commercial entity among four key leaders: Musk, Altman, Brockman, and Ilya Sutskever. Musk deemed this unfair since the funding came from him, and expected to receive a controlling stake.

Jurors will hear from a series of high-profile witnesses and review years of correspondence and corporate documents. They will ultimately deliver an advisory verdict, with the final decision resting with Judge Gonzalez Rogers.

For context, OpenAI completed its restructuring in October, splitting the company into a for-profit corporation and a nonprofit foundation.