Why Elon Musk Is Suing OpenAI: The Fight Over Open‑Source AI

On March 1, Elon Musk formally sued OpenAI and its CEO Sam Altman, claiming they have abandoned the company’s original nonprofit mission to develop artificial intelligence for the benefit of humanity.

The lawsuit, filed in San Francisco, alleges that OpenAI’s partnership with Microsoft has turned the once‑open‑source startup into a profit‑focused enterprise.

OpenAI is now the de‑facto leader in generative AI, with a significant portion of its operating funds coming from Microsoft’s multi‑billion‑dollar investment.

OpenAI’s partnership with Microsoft will not benefit humanity

Musk says that Altman and co‑founder Greg Brockman originally approached him to create an open‑source, nonprofit AI company, but the 2015 startup has since shifted its focus to making money.

According to CourtouseNews, Musk filed the suit on March 29, alleging that the OpenAI‑Microsoft relationship breaches OpenAI’s original commitment to open‑source artificial general intelligence (AGI) for all.

Demand for OpenAI to return to open source

Musk accuses OpenAI of contract violations, breach of fiduciary duty, and unfair business practices, and seeks a court order prohibiting Brockman, Altman, and Microsoft from profiting from OpenAI.

He also demands that OpenAI disclose its research and technology publicly and stop using its assets, including the advanced GPT‑4 model, for Microsoft’s or any individual’s commercial gain.

Musk’s complaint states that OpenAI has become the world’s largest closed‑source tech giant and effectively a Microsoft subsidiary, with its board now prioritizing Microsoft’s profit over human benefit.

Legal experts note that while the lawsuit could pose challenges for OpenAI, the outcome is uncertain.

Pioneer Legal partner Anupam Shukla said the issue is complex and the potential results are unpredictable, adding that OpenAI is unlikely to be forced to dissolve entirely.

Sam Altman’s resignation drama as a power play

The filing also references Altman’s resignation controversy from November of the previous year.

Musk points out that Altman’s ouster prompted Microsoft’s involvement and forced board members who tried to remove Altman to resign.

Musk observes that the current OpenAI board no longer consists of scientists or R&D staff who understand the technology.

He argues that the nonprofit structure originally crafted by OpenAI has been replaced by a profit‑driven CEO and a low‑tech board that even reserves an observer seat for Microsoft.

OpenAI has become a profit‑making tool

Musk, a former board member, left OpenAI in 2018 over concerns that GPT‑4 and future AGI development could threaten public safety.

He believes Microsoft’s control over Altman and the board will keep GPT‑4 from evolving into AGI, preserving the technology’s secrecy and commercial nature.

Musk, also CEO of Tesla and SpaceX, acquired Twitter for $44 billion in October 2022 and has repeatedly called for AI regulation.

He left the OpenAI board in 2018 and frequently criticizes the company’s relationship with Microsoft.

Musk’s xAI

Musk’s own startup xAI is now competing with OpenAI, staffed by engineers from top U.S. tech firms such as Google and Microsoft.

Since December, xAI has launched Grok, a ChatGPT competitor for X’s Premium+ subscribers, aiming to create what Musk calls “the most truth‑seeking AI.”

Musk describes AI as a “double‑edged sword” and notes that a group of AI experts and industry leaders recently called for a six‑month pause on developing systems more powerful than GPT‑4 due to significant risks to humanity.

Since its debut, ChatGPT has been widely adopted for tasks ranging from document summarization to code generation, sparking an AI arms race among major tech companies.