Since last year, Elon Musk has been trying to prevent a restructuring of startup OpenAI that would allow it to go commercial and more easily raise the capital it needs to grow. A judge this week rejected Musk’s request for a preliminary injunction against OpenAI’s restructuring.
Image source: Unsplash, Dima Solomin
Oakland District Court Judge Yvonne Gonzalez Rogers ruled that Elon Musk failed to make a compelling case for a preliminary injunction against OpenAI. The case is not dismissed, however, and a new hearing on the lawsuit is scheduled for later this year. Musk’s representatives were somewhat satisfied with the ruling, with attorney Marc Toberoff expressing hope that the court will further prove that OpenAI CEO Sam Altman was wrong to use Musk’s charitable contributions for personal gain, as they were intended for the “public good.”
The tensions between Elon Musk and the founders of OpenAI led to the former leaving the startup in 2018. Musk has been trying to convince the court and the public that he always intended for OpenAI to remain a non-profit, while the company’s management has increasingly focused on commercial activities over the years. Last December, he filed a lawsuit to block the upcoming restructuring, which would have brought OpenAI’s commercial activities to the forefront. The startup is currently run by a non-profit board of directors, which scares off investors, and OpenAI regularly needs funds for development, so the restructuring should eliminate this problem.
OpenAI representatives pointed out in court that Elon Musk himself had not previously opposed the idea of transferring the startup to a commercial channel, confirming this with archival correspondence. Musk’s current behavior in OpenAI is explained by the desire to restrain the development of a competitor, since since 2023 the billionaire has been trying to gain a foothold in the market of generative artificial intelligence systems with the help of his own startup xAI.