The legal feud between OpenAI and Elon Musk over the artificial intelligence company's shift to a for-profit model is set to accelerate after both sides agreed to fast-track a trial in a California federal court. A Friday court filing revealed plans to expedite proceedings in a case that could reshape the AI industry’s balance of power.
Musk, who co-founded OpenAI with CEO Sam Altman in 2015 before leaving in 2018, sued the company last year alleging it abandoned its original nonprofit mission of developing AI "for the benefit of humanity." OpenAI counters that Musk – whose competing AI startup xAI launched in 2023 – seeks to slow down a rival through litigation.
The dispute centers on OpenAI’s 2023 restructuring, which reduced its nonprofit board’s control. The company argues the move was necessary to raise capital for its $6.6 billion February funding round and potential $40 billion SoftBank-led investment. A judge recently denied Musk’s request to pause the restructuring but approved an autumn trial timeline.
OpenAI stated it "welcomes" the court’s decision, framing Musk’s actions as attempts to "slow down OpenAI for his personal benefit." The case intensified in recent weeks when Altman reportedly rejected a $97.4 billion takeover bid from a Musk-led consortium.
With billions in funding and leadership of the AI revolution at stake, the trial could determine whether OpenAI’s corporate evolution represents responsible scaling or mission drift.
