Openai Feud between Elon Musk, Sam Altman face the federal judge

A federal judge on Tuesday weighed on a prolonged legal feud between billionaires Elon Musk and Sam Altman over Openai, the company they co -founded, and suggested that she is likely to stop the company’s plan to restructure for now.

Musk, a top ally to President Donald Trump and CEO of Tesla and SpaceX, is looking to stop the Microsoft-backed artificial intelligence AI developer in becoming a pre-profit company. He has accused Openai of becoming an “Closed source, profit-maximizer“And he sued the company last year, first in a California court and later in the federal court.

In a courtroom in Oakland, California, on Tuesday, US district judge Yvonne Gonzalez Rogers said that “it is a stretch (too musk) to demand irreparable harm in this case,” added that it is a battle of “billionaires versus billionaires.”

Musk requests a preliminary injunction that would stop Openai’s conversion. Gonzalez Rogers did not immediately give up the case.

Musk, who did not appear during the consultation on Tuesday, was among a handful of co -founders of Openai in 2015. He invested $ 45 million in start -up between that time and 2018, his lawyer said Tuesday. But he and altman fell out with much of their Feud plays public out Online. In 2023, Musk Xai – its own rival to Openai – launched further escalating the tension between them. Musk added Xai as plaintiff in the case last year.

US companies continue to rush to invest in AI infrastructure and development along with the recent innovations from China that have shaken AI developers and investors. Last month, Altman joined Trump in the White House where Trump announced an AI infrastructure project of $ 500 billion called “Stargate.”

A Musk lawyer accused Openai and Microsoft of wrongly accepting the competition, which effectively created monopoly -like conditions that would violate Sherman Antitrust Act. Openai’s lawyers refused the existence of such an agreement.

Openai is “a charity where a small trickle goes to the charity. It all goes to the for-profit company, ”said Musk’s lawyer Marc Toberoff. “When you look at it, it’s a cumulative effect in a beginning industry where Openai – already with 70% of the market, along with Microsoft – tries to strangle their competitors in the crib.”

Openai began its activities as a nonprofit research laboratory before it transitioned to a so-called uncovered surplus model in 2019, which allowed it to function more as a startup, with the nonprofit arm that controlled its pre-profit arm.

In Decemberannounced the company that it would turn against a new pre-profit structure this year, which involves creating a public benefit company — a type of profit company that aims to make a “positive influence” on society-to obtain more capital to compete with the “hundreds of ⁠ billions of⁠ dollars that larger companies are now investing in AI development.”

For Openai, the “public benefit” mission is the persecution of artificial general intelligence or the opportunity to build AI that can essentially think for themselves.

Still, others in tech have also expressed resistance to Openai’s conversion to a pre-profit device. Meta, who owns Facebook and Instagram, reportedly sent California’s prosecutor Rob Bonta a letter in December and asked the state to block it to do so, according to The Wall Street Journal. In December Coded supported Musk’s suit in a statement.

Sarah Eddy, a lawyer for Openai, stood by the company’s decision and told the judge that it would be “financially irrational for investors to invest only in Openai, even if it happened.”

“There are plenty of reasons … For investors to choose one investment vehicle rather than the other,” she said Tuesday.

Openai’s lawyers also argued that Musk previously supported it was a pre-profit device.

Last year, Openai alleged This musk was at the end of 2017 that the “next step of the mission was to create a pre-profit device”, adding that he would “Majority’s Equity, Initial Board Control and be CEO.” Later, when Musk Defended Openai, that Published E emails This claim to show Musk Telling Altman and several others: “Even raising hundreds of millions will not be enough. This immediately needs billions a year or forget it. “

Musk has not publicly dealt with Openais claims.

Gonzalez Rogers said Musk can present his arguments to a jury when the case goes to trial.

“I don’t know what happened, but I certainly don’t throw anything out at a proposal for rejection when it’s plausible that it, Mr. Musk says is true, ”she said. “We find out that he sits on the booth, he wants to present it to a jury. A jury will decide who is right. So something comes to trial. “