Musk: I didn’t read the fine print on OpenAI’s for-profit plan in court
Musk: I didn’t read the fine print on OpenAI’s for-profit plan in court
Elon Musk testifies that he was reassured OpenAI would stay nonprofit, even as talks of a for-profit plan moved ahead, in a high-stakes California trial.
Elon Musk took the stand in a California courtroom amid a high-stakes dispute that could reshape the future of OpenAI and its governance. The billionaire is suing OpenAI, its co-founders, and its CEO, seeking fundamental governance changes and up to $150 billion in damages. The case centers on whether OpenAI pivoted from a nonprofit to a for-profit structure, and whether Musk’s donations and personal support were tied to assurances about the company’s charitable mission. The trial has drawn worldwide attention as OpenAI’s tools, including ChatGPT, have become deeply integrated into daily life and business.
On cross-examination, Musk said that while he was shown a term sheet, his testimony is that he did not read the fine print, only the headline. He described the moment as part of a broader narrative about how OpenAI evolved from a nonprofit foundation to a for-profit entity under the oversight of a nonprofit board. The implications of that move are at the heart of the dispute, with Musk arguing that promises about safety, nonprofit goals, and the public good were never fully honored as the company pursued rapid expansion and substantial investments.
The case also features competing narratives about OpenAI’s direction. Musk’s team contends the company’s leadership and investors sought to balance ambitious AI development with safeguards, while OpenAI counters that Musk’s push for control and his distance from the company since leaving the board in 2018 are driving his legal action. The tension is set against the backdrop of a lucrative, ongoing effort to scale AI technology, including a 2020 deal with Microsoft that Musk has criticized as potentially giving a major tech partner outsized influence over OpenAI’s trajectory.
Legal teams have outlined the scope of the dispute: Musk seeks changes in governance that would limit OpenAI’s leadership’s ability to steer strategy without broader nonprofit oversight, and he seeks substantial damages linked to what he describes as misrepresentations about the organization’s nonprofit status. OpenAI maintains that Musk’s motivations are more about regaining influence over the company and advancing his own AI venture, while arguing that safety and risk controls have always been part of the equation.
As the trial progresses, observers will be watching for how the court weighs governance promises against the company’s evolving business model. The outcome could influence how other tech ventures balance nonprofit ideals with for-profit incentives in the rapidly evolving AI ecosystem. The proceeding continues to unfold, with the potential to redefine how nonprofit commitments shape the actions of for-profit AI leaders and their investors.
