Elon Musk Sues OpenAI for Alleged Breach of Contract
By Jahnavi Nidumolu, Aditya Soni and Akash Sriram
(Reuters) – Elon Musk has sued ChatGPT-maker OpenAI and its CEO Sam Altman, saying they abandoned the startup’s original mission to develop artificial intelligence for the benefit of humanity and not for profit.
The lawsuit filed late on Thursday in San Francisco is a culmination to the billionaire’s long-simmering opposition to the startup he co-founded and has since become the face of generative AI, partly due to the billions of dollars in funding from Microsoft.
Musk alleged a breach of contract, saying Altman and co-founder Greg Brockman originally approached him to make an open source, non-profit company, but the startup established in 2015 is now focused on making money.
Recounting OpenAI’s founding, Musk said the three men had agreed to work on artificial general intelligence (AGI), a concept that machines could handle tasks like a human, but in a way that would “benefit humanity”, according to the lawsuit.
OpenAI would also work in opposition to Google, which Musk believed was developing AGI for profit and would pose grave risks.
Instead, OpenAI “set the founding agreement aflame” in 2023 when it released its most powerful language model GPT-4 as essentially a Microsoft product, the lawsuit alleged.
Musk has sought a court ruling that would compel OpenAI to make its research and technology available to the public and prevent the startup from using its assets, including GPT-4, for the financial gains of Microsoft or any individual.
OpenAI, Microsoft and Musk did not respond to Reuters requests for comment.
The billionaire is also seeking a ruling that GPT-4 and a new and more advanced technology called Q* would be considered AGI and therefore outside of Microsoft’s license to OpenAI.
Reuters in November was first to report on Q* and warnings from OpenAI researchers about a powerful AI discovery.
Musk, who runs Tesla and rocket maker SpaceX and bought Twitter for $44 billion in October 2022, stepped down from OpenAI’s board in 2018 and has on several occasions called for regulation on AI.
“We expect this will have 0 impact on AI development inside or outside of OpenAI, and would chalk it up to Musk seeking to get a slice of equity in a company he effectively founded but in which he holds no stake,” said Giuseppe Sette, president and co-founder of market research firm Toggle AI.
OpenAI’s tie-up with Microsoft is under antitrust scrutiny in the United States and Britain following the startup’s boardroom battle last year that resulted in the sudden ouster and return of Altman and the creation of a new temporary board.
The startup is planning to appoint new board members in March, the Washington Post reported on Thursday. Microsoft said in November it would have a non-voting, observer seat on the board.
Some legal experts said Musk’s allegations of breach of contract, which is partly based on an email between Musk and Altman, could fail to hold up in court.
While contracts can be formed through a series of emails, the lawsuit cites an email that appears to look like a proposal and a “one-sided discussion”, said Brian Quinn, a law professor at Boston College Law School.
“To the extent Musk is claiming that the single e-mail in Exhibit 2 is the ‘contract’, he will fall well short,” Quinn said.
MUSK’s xAI
Musk has mounted a rival AI effort with his startup xAI, which is made up of engineers hired from some of the top U.S. technology firms such as Google and Microsoft that he hopes to challenge.
The startup started rolling out its ChatGPT competitor Grok for Premium+ subscribers of social media platform X in December and aims to create what Musk has said would be a “maximum truth-seeking AI”.
The billionaire, who has called AI a “double-edged sword”, was among a group of AI experts and industry executives that last year called for a six-month pause in developing systems more powerful than OpenAI’s GPT-4, citing great risks to humanity and society.
Since its debut, ChatGPT has been adopted by companies for a wide range of tasks from summarizing documents to writing computer code, setting off a race among Big Tech companies to launch their own offerings based on generative AI.
(Reporting by Sheila Dang in Austin and Tom Hals in Wilmington; Jahnavi Nidumolu, Aditya Soni, Akash Sriram, Yuvraj Malik in Bengaluru; Additional reporting by Gnaneshwar Rajan; Editing by Andrew Heavens and Arun Koyyur)
