Elon Musk has recently experienced a few setbacks – and a black eye – but things appear to be going right for him in some areas of his business life. (Photo: Francis Chung / EPA / POOL) By Deepa Seetharaman and Max A. Cherney
Musk's lawsuit alleges OpenAI ditched its mission to build artificial intelligence for the public good, and he is seeking billions of dollars and a change in management and direction for OpenAI, which says Musk knew exactly what was going on and was angry he was not made CEO.
William Savitt, a lawyer for OpenAI, told Musk his questions about the tax benefits of his $38 million in donations to OpenAI and the company's corporate structure were meant to be simple, and that Musk's responses should be as well.
"Your questions are not simple. They're designed to trick me," Musk, the CEO of Tesla TSLA.O and SpaceX, told a nine-person jury in Oakland, California, federal court.
The heated exchange came after Musk, over two days of questioning by his own lawyer, accused OpenAI, its co-founder and Chief Executive Sam Altman, and its President Greg Brockman of promising to build a nonprofit to develop AI responsibly, before pivoting to create a for-profit entity in 2019 to enrich themselves.
OpenAI has argued that Musk, who helped finance the company's early growth, is driven by a compulsion to control it and bitterness over its success after he left the board in 2018. It has said he is seeking to bolster his own AI company, SpaceX unit xAI, which lags OpenAI in user adoption.
The company also contends Musk pushed OpenAI to become a for-profit business, wanted to become CEO, and that safety was not a priority for him when he was with the company.
Savitt asked Musk about an email he sent Altman in 2015 suggesting OpenAI be structured as a for-profit corporation with a parallel nonprofit, part of an effort to show Musk was supportive of a for-profit entity. Musk said the emails did not indicate his definitive position.
"Discussions and brainstorming are not a deal," said Musk, wearing a dark suit over a white shirt and glancing at the jury occasionally as he spoke.
Seated in the courtroom audience, Altman and Brockman - who took notes with a red-ink pen on a yellow legal pad - listened intently as the exchanges between Musk and Savitt grew increasingly heated.
Musk repeatedly asked Savitt to stop interrupting him. Musk answered one of Savitt's questions by saying, "You tell me." Savitt responded, "I get to ask the questions, Mr. Musk."
Musk is expected to return to the stand for more cross-examination on Thursday.
MUSK SAYS ALTMAN OFFER 'FELT LIKE A BRIBE'
The trial highlights the depth of the rupture between Musk and Altman. The pair co-founded OpenAI in 2015 to create a benevolent steward of the technology and fend off rivals such as Alphabet's GOOGL.O Google. Musk testified he left OpenAI in 2018 to focus on Tesla and SpaceX.
Microsoft MSFT.O, also a defendant, invested $10 billion in OpenAI in 2023, a deal Musk said fueled his concerns that OpenAI was abandoning its mission.
Jurors saw text messages Musk and Altman exchanged after news broke of Microsoft's potential investment. Musk told Altman the move felt like a "bait and switch." Altman responded, "I agree this feels bad."
JURY SEES ALTMAN'S TEXTS TO MUSK
Earlier on Wednesday, jurors saw an email Musk sent to Altman and Brockman in 2017, referring to himself as a "fool" for providing them funding for what he believed was a nonprofit venture.
"What they really wanted to do was create a for-profit where they had as much shareholder ownership as possible," Musk said under questioning by his lawyer, Steven Molo.
OpenAI has said it created a for-profit entity to allow it to accept private investments to help buy computing power and pay top scientists.
On cross-examination, Savitt highlighted instances in which Altman appeared to keep Musk apprised of OpenAI's plans to create a for-profit entity and pursue investment from Microsoft.
Savitt asked Musk if he had responded to an April 3, 2019, text message Altman sent him asking, "Do you have a few mins to talk about the Microsoft/openai investment?" Musk said he did not recall if he responded.
MUSK SEEKS $150 BILLION IN DAMAGES
OpenAI is preparing for a potential initial public offering that could value it at $1 trillion, Reuters has reported. The company also faces growing competition from rivals, including Anthropic.
SpaceX is also expected to go public this year at a valuation that could reach $1.75 trillion.
Musk is seeking $150 billion in damages from OpenAI and Microsoft, with any award going to OpenAI's charitable arm. He also wants OpenAI to revert to a nonprofit, with Altman and Brockman removed as officers and Altman removed from the board.
His claims include breach of charitable trust and unjust enrichment.
(Reporting by Deepa Seetharaman and Max A. Cherney in Oakland, CaliforniaWriting by Luc CohenEditing by Shri Navaratnam, Rod Nickel)