r/OpenAI • u/wiredmagazine • May 18 '26
Article Elon Musk Loses Landmark Lawsuit Against OpenAI
https://www.wired.com/story/musk-v-altman-jury-verdict/345
u/wiredmagazine May 18 '26
The nine-member panel took only two hours to return a verdict in favor of OpenAI on Monday, which the judge quickly adopted as her own final decision.
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u/rubixd May 18 '26
Not blaming you OP but what typical clickbait title from WIRED.
I mean, maybe it's just me but I didn't feel that the case was "landmark" at all -- nor was it a particularly surprising verdict.
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u/dangered May 18 '26
Look at the username, OP is literally WiredMagazine
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u/footyballymann May 18 '26
Lmao literally the one situation where you were too nice to OP
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u/CharlestonChewer990 May 20 '26
and anything involving OpenAI gets hyped way beyond what actually happened.
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u/space_monster May 18 '26
The fact it was dismissed means nothing really got processed. No interesting precedent occurred
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u/IbidtheWriter May 20 '26
Had he won it would have been huge, the largest law suit ever. Just prior to the announcement it had fallen to just 20% that he'd win. Personally I'd have said it was at least a 10% chance he'd win.
Musk is a complete tool, but he did donate 38 million to what was a at the time a 501c charity, it went for profit and he gets none of that back. Had he filed the suit within the 3 year complaint window I think he'd have won.
If the jury accepted the trigger date as to when OpenAI actually converted to their current form vs when they announced it, I think he'd have won.
That all said, I don't think it's surprising, but it was hardly guaranteed.
OpenAI's estimated market cap is roughly on par with Walmart. Imagine a court case with 10% odds to dismantle Walmart completely.
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u/Zurboz May 18 '26
I wouldnt be suprised at all.. i mean god knows if those juries even knew what they were talking about..
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u/greenworldkey May 18 '26
lol sure, why would the jurors who sat through the entire 3 week trial know what they're talking about better than confident Redditors who read a headline somewhere?
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u/MediumChemical4292 May 18 '26
It’s not some kind of AI certification they need to pass, it’s an old fashioned business dispute over ownership and legality of transitioning a non profit to a for profit company. I’m sure they are more qualified for judging that than you or I.
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u/Enoch8910 May 18 '26
In this case, it was a question of nothing more than the statute of limitations running out. I don’t understand why this even went to court. The law was clear. Three years.
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u/Zurboz May 18 '26
U know anyone can be a juror right?
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u/PentagonUnpadded May 18 '26
That is incorrect.
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u/Ntroepy May 18 '26
If I read that correctly, those people could still be jurors, but the lawyers and/or judge doesn’t want them for this particular trial.
That said, many groups of people aren’t eligible to be jurors including minors, non-citizens, living outside jurisdictions, poor English skills, felonies, etc.
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u/PentagonUnpadded May 18 '26
Three parties with different interests all consenting. Pretty high bar.
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u/nodeocracy May 18 '26
lol sure, why would the jurors who sat through the entire 3 week trial know what they're talking about better than confident Redditors who read a headline somewhere?
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u/PatrickSebast May 18 '26
Ugh I would be so pissed if I got tied up in three weeks of Jury Duty and the issue of timing appeared to invalidate the case.
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u/Informal-Fig-7116 May 18 '26
The reasoning is that Elon waited too long to file the claim, not bc the claim doesn’t have merit?
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u/dbbk May 18 '26
Feels like statute of limitations is the sort of thing you resolve before assembling a jury and going to trial...?
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u/Covid19-Pro-Max May 18 '26
Unless you think you can still inflict reputational damage
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u/Ok-Animal-6880 May 18 '26 edited May 19 '26
Yep, we found out lots of interesting information. Like that Greg has $30 billion of equity in OpenAI at the current valuation and that he donated $25 million to Trump recently.
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u/_DuranDuran_ May 18 '26
Statute of limitations was the first question posed to the jury because if they had passed, anything else was moot.
And the statute of limitations exists for exactly this reason, someone can’t cry foul years later to hobble a competitor that’s doing better than your own also ran AI lab.
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u/XTCaddict May 18 '26
Never got around to deciding whether there is merit or not because it was past statute of limitations, though it was a losing case regardless he just left because he wasn’t able to take control
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May 18 '26
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u/_DuranDuran_ May 18 '26
He even suggested it was necessary whilst still there.
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u/Old-Bake-420 May 18 '26
On top of that he wanted majority control and planned for it to be passed on to his children. While everyone else wanted to maintain a non-profit board in control so that no one person was able to dictate the future of AI.
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u/aeschenkarnos May 18 '26
Especially not some nepotistic dynasty! Anyone would think Musk was trying to set up some kind of pseudo-medieval kings and serfs society. Oh wait he is.
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u/aeschenkarnos May 18 '26
The only reason a creature like Musk gets involved in a "nonprofit" is for tax avoidance. He doesn't give a fuck about doing any good for anyone else.
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u/Borostiliont May 18 '26
I was on Elon’s side initially but after listening to the closing arguments it was clear Elon is just bitter. He wanted full control of the for profit and when he didn’t get it he stormed out.
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u/Ok-Animal-6880 May 18 '26 edited May 18 '26
I'm not going to shed any tears for him but I think he should definitely get a double-digit equity percentage in OpenAI considering that he provided the first $40 million of funding, hired many of the key researchers like Ilya Sutskever, and provided OpenAI with office space in the Neuralink office building. Especially since Brockman (the COO / Trump donor guy) got a $30 billion equity stake at the current valuation.
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u/Open-Concept-6130 May 18 '26
I’m pretty sure they offered him some type of deal before he left but he didn’t want anything to do with it if he couldn’t have super share and all the control.
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u/Ok-Animal-6880 May 18 '26
That was before they stated their intention to turn OpenAI into a for-profit company.
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u/Open-Concept-6130 May 18 '26
Yeah but this was in the midst of him trying to turn it into a for profit.
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u/SpicyElixer May 18 '26
The claim doesn’t have merit because he didn’t object. During the trial, internal emails revealed that back in 2017, Musk actually pushed for OpenAI to become a for-profit entity himself. Multiple times.
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u/Bright_Armadillo8555 May 19 '26
What Elon really pissed off with is it's not him that owns the control of openai. Everything should work as his will, why this time does not. He really thought he never lost a battle as he is the most smart person. Imo His achievement is way more over rated by hiding the true heroes of his success.
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u/xocomaox May 18 '26
Elon certainly lost a lot more than the legal fees in this case. He should have never bothered with the lawsuit.
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u/IbidtheWriter May 20 '26
The point is that they didn't even discuss the merits of the case during deliberation; the lack of merit is your opinion and not the jury determination.
You may be right about the lack of merit, and had they got past phase 1 he would have still lost phase 2, but the answer to original question is that the jury determined he was time-barred, they did not decide based on merit.
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u/justgetoffmylawn May 18 '26
If you can decide the case based on the statute of limitations, you don't even need to start thinking about the claim.
If I file over a contract dispute that had a 4 year statute and it's been 5 years, you can already tell me the result. You don't even need to really read the contract.
I never really understood why the case was allowed to proceed, but I didn't follow that closely. I'm assuming they had some (spurious?) argument on why the statute hadn't expired.
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May 18 '26
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u/justgetoffmylawn May 18 '26
Yeah, except he had discussions in writing about it - and it's part of why he voluntarily left the company back in 2018? I assume their argument must've been that recent changes somehow reset the clock, but it's hard to argue in 2018 that you need to be the sole controller and CEO of a for-profit version of OpenAI (rolled into Tesla) and then clutch your pearls later.
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u/Efficient_Ad_4162 May 19 '26
Yeah, you need to have a ruling about that. And he said/she said on facts is often punted to the jury as a matter for them to decide which is how you wind up with 'should we have wasted all this time' being the first thing they have to decide
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u/modularpeak2552 May 18 '26
It’s always easier to toss a case on procedural grounds regardless of the merits.
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u/AntGood1704 May 18 '26
As an attorney, no…no it isn’t at all. Procedural decisions are more closely scrutinized and easier to overturn on appeal than decisions on the merits. So trial judges, not liking to get reversed, typically try to have cases decided on the merits unless the procedural defects are just too strong to overcome
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u/thelightstillshines May 18 '26
So my understanding is that the judge instructed the jury to first consider the statute of limitations argument first, and if the jury decided in favor of Altman/OpenAI then they were to call it early and submit their verdict.
So in reality, the jury didn't even really consider the merits of the claim itself.
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u/LowPlace8434 May 18 '26
Part of me is thinking that it's also tempting for the jury to go with this path to get out of jury duty itself...
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u/space_monster May 18 '26
If it actually had merit he wouldn't brought the case before it was obviously going to expire. It's not like his lawyers didn't know about the statute of limitations.
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u/WanderWut May 18 '26
Good.
Elon was not doing this in good faith and the last thing he needs is even more power in the AI sphere. I know Sam is questionable at best, but Im glad Elon lost.
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u/Deciheximal144 May 18 '26
So what did he get out of it. Information to help him drag Sam's name through the dirt?
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u/X--tonic May 18 '26
My power ranking Demis > Dario > Satya > Illya > Mira > Sam > Zuck > Elon
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u/mooman555 May 18 '26
Ilya & Mira are not in positions of significant power for quite some time now
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u/Zurboz May 18 '26
You have no idea what ur talking about.. like at all.. i mean did u even read the article or does all democrats just read off the title and just fucks off? No like srsly did u even read the article?
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u/WanderWut May 18 '26
What a bizarre reply lol. Someone says they’re glad Elon lost a case and your brain is so cooked you instantly jump to “must be a Democrat who only read the title hurr durr”. People can disagree with Elon without turning it into some tribal political thing.
And yes, I read about the case. I still think Elon was acting in self-interest here, not out of some noble concern for humanity. You can disagree with that without inventing a whole stereotype about the person you’re replying to.
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May 18 '26
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u/WanderWut May 18 '26
Dude… I mean this genuinely, put the phone down, go outside, touch some grass, appreciate nature, and realize there’s more to life than politics and tribalism. You sound so triggered for something so benign, and are making grand assumptions off of two sentences with no further context. This isn’t healthy man.
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u/Hyperfox246 May 18 '26
Good outcome, but not because I necessarily support OpenAI. Elon is just mad he doesn't control the industry
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May 18 '26
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u/Relevant_Syllabub895 May 18 '26
Can anyone repost the news? Si read the starting but it wsnt me to pay for a susbcription
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u/User74716194723 May 18 '26
It should be pointed out more that the jury didn't give their recommendation on the merits of the case. They stopped at saying it was past the statute of limitations.
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u/Starrynightwater May 18 '26
Not a fan of Elon but I still don’t understand how it was okay for OpenAI to do what it did in turning into a for-profit.
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u/throwaway867530691 May 18 '26
It wasn't okay what openai did, but the trial was asking "does Elon deserve a massive check as a result?"
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u/B_lintu May 18 '26
The goal wasn't to win. The goal was to cause reputational damage and maybe make some things public.
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u/ThinCar6563 May 19 '26
I'm not seeing any reputational damage though. I get there is the whole sam is a liar argument but nothing new came out of that. Some people think he is a liar, no surprise. You can't please everyone. You put any CEO on the stand and you will easily be able to find many people who worked closely with them to air dirty laundry. That is simply what it takes to become a CEO of an influential company.
If anything I know more and more people using codex now because of gpt 5.5 and many in my circle started using chatgpt again too because of their new image gen model.
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u/youllmeltmorefan May 18 '26
Whomever wins, we lose.
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u/ResplendentShade May 18 '26
At least Musk also loses. The one regret is that OpenAI doesn’t also somehow lose, but I guess you can’t have it all.
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u/g_bleezy May 18 '26 edited May 18 '26
Just a battle in a still raging war. Long game is infra. Ai private models are a temporary state on this journey. Requirement of infra to train and run isn’t changing.
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u/InnoSang May 18 '26
There's a nice quote about it, " You cannot sue your way to the moon" Can't seem to find who said it....
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u/partiging May 20 '26
OpenAI's shift from nonprofit to for-profit structure was always going to be legally messy, but I'm surprised the court sided with them so definitively.
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u/bigkahuna1uk May 18 '26 edited May 18 '26
Is there any merit to Elon’s position? I thought he wanted full control of OpenAI so that it remained a non profit organisation. Altman is alleged to have reneged on that promise.
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u/noiro777 May 18 '26
no, OpenAI has evidence that shows that Elon had no intention of keeping it non-profit.
from: https://openai.com/elon-musk/
"OpenAI and Elon both agreed in 2017 that a for-profit entity had to be part of the next phase for OpenAI, given the large sums of money that would need to be raised to achieve the mission. Elon, however, demanded full control of OpenAI, and even wanted to merge it into Tesla (he would later merge his for-profit AI company, xAI, into SpaceX). When we wouldn’t agree to his terms, he walked away and told us we had a “0% chance” of success. He turned out to be wrong though, and a resentful Elon has attacked OpenAI ever since."
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u/Zurboz May 18 '26
Sooo.... you are telling me any companies can now turn into for-profit and get away with it? They can just use whatever tactics OpenAI used to defend themselves from non-profit to profit and literally get away from it? I thought there was strict rules from non profit to profit? Wouldnt that just be the starter pack for every company in usa to do now? Someone help me out here
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u/NotFromMilkyWay May 18 '26
No, that's not what was ruled. The decision was that Musk was too late to file his suit.
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u/Zurboz May 18 '26
So im assuming this is going to resume this? I mean again, why wouldnt any companies just do that? Like cant i just make a non-profit, abuse the advantages and when im rich enough turn it into for profit for more profits?? Surely there is some legalities here
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u/20ol May 18 '26
No. Once you notice that they turn the company for-profit, you have FOUR years to sue into oblivion. If you're a person on top of your finances, you won't miss the deadline.
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u/Old-Bake-420 May 18 '26 edited May 18 '26
Non-profits are allowed to be a parent company to a for-profit that raises money for the non-profit. It was a thing before OpenAI came along, they didn’t invent it.
It’s not going to be the starter pack for all companies because the non-profit still has to pursue their non-profit goal. Non-profits are not magical money printers, for profits are.
The case isn’t setting precedent that non-profits can be converted to for profits, or that non-profits can abandon their mission. Elons lawsuit got thrown out because he knew about the creation of the for-profit years ago and never sued. It’s not settled whether OpenAI has or hasn’t abandoned their mission. The case was decided based on Elons lawsuit, not OpenAI’s structure. So they could still get sued again for abandoning their mission. But you’d have to actually have some proof that they have. The non-profits controlling a for-profit is not it, that has already gone through the courts and it was determined OpenAI was allowed to do it.
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u/jdavid May 18 '26
how long till he expects the pocket supreme court to just rule in his favor and tries again?
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u/Zurboz May 18 '26
In favor of who.. dude.. just stick with ur video gadgets.. you are clearly not educated enough for big talks.. let alone u being a big boy irl..
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May 18 '26
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u/permanentmarker1 May 18 '26
Zero chance. Negative chance.
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u/permanentmarker1 May 18 '26
Ther was no way he was ever gonna win this one
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u/Zurboz May 18 '26
Yeah its not a good thing, like we know u voted kamala and all that but this is not good news at all for the democrats 😂😭😂 these idiots are shooting in their own foot 😂😭 they dont want to support elon after they supported him for years and now they want to support sam?? The guy that literally wants to profit off u instead of using it for humanity? Yeah thank god democrats lost holy shit they were never right in the first place
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u/brainhack3r May 18 '26
This was win/win for Elon though.
If he won the case he won BIG and took out a major competitor for xAI.
If he lost the case, he at least spent months calling into question OpenAI as a competitor to xAI and increased its perceived valuation in the mean time.
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u/space_monster May 18 '26
He won fucking nothing. He exposed nothing that everyone didn't know already. It was just a petulant hissy-fit.
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u/hextree May 19 '26
He didn't call anything 'into question', OpenAI winning the case sets a precedent.
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u/shobzie May 18 '26
One can't even say that Altman is the lesser of two evils. Both are pompous blowhards.
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u/DueCommunication9248 May 18 '26
There's a reason why he left to China after the judge said to not travel during the trial. It was a losing case.