Sam Altman and OpenAI Beat Elon Musk in Court, Paving the Way for a Possible IPO
Elon Musk’s court battle with OpenAI CEO Sam Altman came to an abrupt end Monday after a judge unanimously found that Musk’s allegations that Altman “steals from charity” fall outside the statute of limitations for trial.
Musk’s proposed lawsuit is linked to his past as the founder of OpenAI, which was founded as a non-profit organization in 2015. Musk alleged that Altman used his financial resources to expand OpenAI’s operations before turning the organization into a commercial enterprise.
Musk’s lawsuit said Altman and OpenAI president Greg Brockman violated a founding agreement (PDF) that said the company’s technology would “benefit the public and [OpenAI] will seek to open source technology for public benefit where appropriate. [OpenAI] it is not intended for the private benefit of any person.”
Microsoft was also named as a defendant in the lawsuit, with Musk alleging that the company’s investment in 2019 and continued interest in OpenAI combined to aid and abet the startup in its breach of the patent agreement.
(Disclosure: Ziff Davis, CNET’s parent company, in 2025 filed a lawsuit against OpenAI, alleging that it infringed Ziff Davis’ copyrights in training and using its AI programs.)
Musk’s filing called for tens of billions of dollars to be taken out of OpenAI’s for-profit operations and redistributed to the “non-profit OpenAI mission.” He also hoped that the court would favor the removal of Altman and Brockman from their senior positions in the company.
The case was filed in federal court in Oakland, California, and was presided over by US District Judge Yvonne Gonzalez Rogers, who accepted the jury’s unanimous verdict, reached after three weeks of testimony and just 2 hours of trial.
Ruling in Altman’s favor, the court found that the “claims for breach of charitable trust and unjust enrichment are prematurely dismissed.” Musk would have had to file a lawsuit within three years of leaving OpenAI for his claims to be heard. All claims against Altman, Brockman and Microsoft have been dismissed. Musk’s lead attorney, Steven Molo, has reserved the billionaire’s right to appeal the decision.
Musk and Altman continue to guide their AI companies to the public market. Altman’s win paves the way for OpenAI’s potential multibillion-dollar stock market. Musk’s SpaceX, which merged with xAI earlier this year, filed for an IPO in April.
Representatives for OpenAI and law firm MoloLamken, which represented Musk, did not immediately respond to a request for comment.
OpenAI CEO Sam Altman won the lawsuit, in which Musk sued the company for allegedly abandoning his non-profit work.
A fast-paced slugfest between tech giants
The world’s richest man and leader in the AI industry were once friends, but any pleasantries shared between Musk and Altman are in the rearview mirror.
The dramatic three-week trial saw both men bring witnesses to the stand to discuss each other’s stories, as personal evidence and secret messages were dragged into the open.
Musk’s legal strategy focused heavily on portraying Altman as a novice and a fraud, prompting former OpenAI founders and scientists to argue that Altman was not a credible actor in his business dealings at OpenAI.
The former chief scientist of OpenAI, Ilya Sutskever, was brought to the stand repeating his claim that Altman “shows a flexible way of lying, undermining his killers and contradicting his superiors.”
The company’s former chief technology officer, Mira Murati, made a similar claim, saying Altman often “said one thing to one person and completely different to another person.”
On the other hand, Altman’s legal team presented evidence that Musk had floated the idea of turning OpenAI into a for-profit company, provided he could take over.
The barbs took a turn for the worse when Shivon Zilis — former OpenAI board member, current Neuralink CEO and mother of Musk’s four children — was accused of inspecting OpenAI’s inner workings to report to a colleague.
OpenAI’s lawyers also say Musk’s suit is designed to bring down rival xAI, the AI company he founded in 2023.
The court case culminated in Musk leaving the country to join President Donald Trump on his trip to China, violating Judge Gonzalez Rogers’ order that he remain present at the hearing.
