Musk’s amended lawsuit against OpenAI names Microsoft as a defendant

Musk’s lawsuit against OpenAI accusing the company of abandoning its non-profit work was dismissed in July, then renewed in August. Now, in an amended complaint, the lawsuit names new defendants including Microsoft, LinkedIn founder Reid Hoffman, and former OpenAI board member and Microsoft VP Dee Templeton.

The amended filing also adds new plaintiffs: Neuralink CEO and former OpenAI board member Shivon Zilis and Musk’s AI company, xAI.

In the complaint, Musk’s lawyers say OpenAI is “trying to eliminate competitors” such as xAI by “extracting promises from investors not to support them.” It is also alleged to be unfairly benefiting from Microsoft’s infrastructure and expertise in what Musk’s lawyer described in the filing as a “de facto” merger.

“xAI is harmed by, without limitation … the inability to license the OpenAI technology exclusively licensed by Microsoft … the inability to obtain a computer from Microsoft on terms anywhere near favorable to OpenAI … and the exclusive trade between OpenAI and Microsoft’s competitive intelligence. .”

Hoffman’s position on the boards of Microsoft and OpenAI while also being a partner at Greylock, an investment firm, gave Hoffman an exclusive — and illegal — opportunity to oversee the companies’ operations, the complaint says. (Hoffman steps down from OpenAI’s board in 2023.) Greylock invested in Inflection, Musk’s lawyer notes, an AI startup hired by Microsoft earlier this year — and which could be considered a competitor to OpenAI, according to the complaint.

As for Templeton, whom Microsoft briefly appointed a non-voting board observer at OpenAI, the amended filing alleges that he was in a position to facilitate agreements between Microsoft and OpenAI that would violate antitrust laws.

“The purpose of the ban on affiliated regulatory offices is to prevent the sharing of competitively sensitive information that violates antitrust laws and/or to provide a forum for other anti-competitive activities,” the complaint reads. “To allow Templeton and Hoffman to serve as members of OpenAI…. the board underestimated this objective. “

According to the amended complaint, Zilis, who resigned from OpenAI’s board in 2023 after serving as a member for nearly four years, has standing as an “injured employee” under the California Corporations Code. Zilis has voiced concerns about OpenAI’s internal interactions that have fallen on deaf ears — concerns very similar to Musk’s, according to the complaint.

Zilis has a close relationship with Musk, having served as a project director at Tesla from 2017 to 2019 in addition to directing Neuralink research. (Neuralink is Musk’s brain-computer system.) She is also the mother of Musk’s three children, Techno Mechanicus and twins Strider and Azure.

The 107-page amended complaint includes unusual details that OpenAI CEO Sam Altman proposed that OpenAI sell its own cryptocurrency in September 2017, before it decided to switch to a fixed income structure. Musk is said to have shot down the idea of ​​selling crypto.

The bottom line of the case remains the same on the plaintiff’s side: that OpenAI benefited from Musk’s early involvement with the company yet reneged on its nonprofit’s promise to make the fruits of its AI research available to all. “No amount of clever design or creative thinking can hide what’s going on here,” the complaint reads. “OpenAI, Inc., founded by Musk as an independent charity dedicated to security and transparency… [is] quickly became a profitable subsidiary of Microsoft.”