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

Elon Musk’s lawsuit against OpenAI accusing the company of abandoning its nonprofit mission 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.

Musk was one of the original founders of OpenAI, which was aimed at researching and developing AI for the benefit of humanity, and was originally founded as a non-profit organization. He left the company in 2018 after disagreements over its direction.

In the complaint, Musk’s lawyers say OpenAI is now “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 has been harmed, without limitation … the inability to obtain a computer from Microsoft on terms anywhere favorable to OpenAI … and the exclusive exchange between OpenAI and Microsoft of competitively sensitive information,” reads the complaint, filed Thursday at the end of the meeting. court in Oakland, California.

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, who was briefly appointed by Microsoft as a non-voting board observer at OpenAI, the amended filing alleges that he was in a position to enter into 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. “

Along with Microsoft, Hoffman, and Templeton, California attorney general Rob Bonta is named as a defendant in Musk’s complaint. Bloomberg reported this month that OpenAI is in talks with Bonta’s office about the process of changing its corporate structure.

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 January 2018, before ultimately deciding to switch to a limited profit structure.

“Heads up, I spoke with the security team and there were a lot of concerns about the ICO and the potential unintended consequences in the future,” Altman wrote in an email to Musk dated Jan. 21, 2018, a filing with the amended complaint shows. exhibitions. An ICO, or initial coin offering, is an unregulated way in which money is raised for cryptocurrency businesses. “I would stress the need to keep this confidential, but I think it’s very important that we buy in and give people a chance to weigh in early.”

Musk is said to have shot down the idea of ​​selling crypto. “I have considered the ICO method and will not support it,” he wrote in an email reply to Altman and OpenAI founders Greg Brockman (now president of OpenAI) and Ilya Sutskever (former chief scientist of OpenAI), the show shows. “In my opinion, that would lead to a huge loss of credibility for OpenAI and everyone associated with the ICO.”

The bottom line of the case remains the same on the plaintiffs’ 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. “There is no framework for intelligent design or intelligent design that can obscure what is happening 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.”

OpenAI has sought to dismiss Musk’s lawsuit, calling it “bad” and baseless.