The swift jury verdict dismissing Elon Musk’s lawsuit against the co-founders of OpenAI and Microsoft corroborated courtroom observations: Musk’s legal challenge was inherently weak, exacerbated by the significant delay in its submission.
During the closing arguments last week, OpenAI’s legal counsel meticulously demonstrated their client’s strong legal standing, whereas the plaintiff’s team primarily targeted Sam Altman’s perceived lack of credibility and conveyed astonishment that any party would dispute Musk’s claims.
Consequently, the verdict left some, including Musk himself, struggling to comprehend his loss. In a subsequent, deleted post, Musk labeled Judge Yvonne Gonzalez Rogers a “terrible activist Oakland judge” and asserted that “there is no question to anyone following the case in detail that Altman & Brockman did in fact enrich themselves by stealing a charity.”
However, Altman and Brockman were not the sole individuals who benefited from OpenAI’s non-profit endeavors. Despite Musk and his legal team’s attempts to center the trial on Altman, the proceedings equally illuminated aspects of Musk’s own conduct.
A particular incident disclosed during the trial highlighted Musk’s benefit from OpenAI in a manner that struck an uncomfortably familiar chord. Greg Brockman recounted under oath that in 2017, Musk requested he bring a team of OpenAI researchers to Tesla’s headquarters for several weeks to assist the autopilot division. Brockman stated, “It was pretty clear that was not something we could say no to.”
Brockman detailed leading a contingent of prominent scientists, including Andrej Karpathy, Ilya Sutskever, and Scott Grey, to consult with Tesla’s “demoralized” workforce. Their collaboration generated concepts for enhancing the vehicle’s self-driving technology, with Sutskever notably advising the team that locating 10,000 images of a challenging corner case would enable them to rectify their software. Musk even requested Brockman suggest employees for termination, a request he declined.
An individual with knowledge of the event corroborated Brockman’s narrative, adding that Tesla did not compensate OpenAI for its employees’ time and effort. Musk’s family office, Excession, did not respond to a request for comment.
At the core of Musk’s legal challenge was the assertion that Altman, Brockman, and OpenAI engaged in a “breach of charitable trust” — alleging that funds he donated for a specific philanthropic objective were instead diverted by his co-founders for alternative purposes. He further accused them of “unjust enrichment” through stock and other benefits derived from OpenAI’s for-profit entity.
Regarding the deployment of OpenAI scientists to Tesla, it was highlighted that Musk’s charitable contributions, which he claimed as tax deductions, were utilized to employ scientists at a non-profit dedicated to advancing the benefits of AGI. Subsequently, he directed these scientists to work without compensation for his for-profit enterprise.
Dorothy Lund, a Columbia Law School professor and co-host of the Beyond Unprecedented podcast, informed TechCrunch that such an arrangement would likely be illegal. She remarked that it was “a bit rich for Musk to be suing for breach of a charitable trust, when he appears to have been redirecting assets in a way that was inconsistent with that mission.”
While the self-driving work undeniably involved artificial intelligence, witnesses for Musk underscored that Tesla’s self-driving initiative diverged significantly from OpenAI’s core research agenda. This distinction was partly evidenced by Andrej Karpathy’s departure from OpenAI to join Tesla soon after this event. OpenAI’s legal team characterized this recruitment as Musk’s violation of his fiduciary duty to the lab, where he served as co-chair of the board, by enticing a pivotal researcher to his private company.
Another factor that undoubtedly swayed the jury was the extensive period Musk dedicated in 2017 to attempting to secure exclusive control over a prospective OpenAI for-profit affiliate. Musk employed a combination of persuasive and coercive tactics, offering free Teslas while simultaneously threatening to cease his donations, in an effort to convince his co-founders to grant him complete authority over the entity.
These endeavors placed his attorneys in a precarious position, tasked with persuading the jury of a substantial divergence between Musk’s initial vision and the for-profit entity that ultimately materialized. They posited that a “small adjunct” for-profit would be permissible, despite OpenAI’s witnesses demonstrating the commonality of non-profit organizations operating with significant commercial divisions.
Indeed, a highly plausible alternate scenario exists where Musk could have accepted one of his co-founders’ proposals for a more equitable equity distribution, positioning him today as one of OpenAI’s largest, albeit non-controlling, shareholders. However, multiple associates testified during the trial that Musk consistently declines to invest in any business unless he can exert sole control.
While the dismissal of Musk’s claims due to late filing has been characterized as a mere technicality, the statute of limitations carries substantial underlying rationale: individuals and organizations make critical decisions and allocate resources based on their belief in the permissibility of their actions. Should a litigant like Musk unduly delay legal action, the consequential costs of undoing those established decisions can surpass the potential for equitable compensation.
No jury members have publicly elaborated on their deliberation process or the rationale behind their verdict. Nevertheless, they were instructed to assess whether, prior to August 5, 2021, Musk ought to have been aware of OpenAI’s resource expenditure outside its stated mission or its establishment of a for-profit affiliate. The implication is unequivocal: Musk himself was actively engaged in such activities.
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