Elon Musk’s lawsuit against OpenAI will go to trial after a U.S. judge said there is evidence to support the billionaire’s case.
Musk sued OpenAI and its co-founders Sam Altman and Greg Brockman in 2024, alleging they betrayed their original contractual agreements by pursuing profits instead of the nonprofit’s founding mission to develop AI that benefits humanity.
Musk, who has launched his own for-profit company xAI, was an early financial backer and co-founder of OpenAI. He resigned from the board in 2018 after his bid to take over as CEO was rejected by the other co-founders, who put Altman up for the job. Officially, Musk cited potential conflicts of interest with Tesla’s own AI development for self-driving cars.
Since leaving OpenAI, he’s been a vocal critic of the firm’s transition to a for-profit model, and even made an unsolicited $97.4 billion bid to buy OpenAI in February 2025, which Altman rejected. OpenAI, which was founded in 2015 as a nonprofit research lab, first began to move away from its pure nonprofit roots in 2019 by creating a for-profit subsidiary with a “capped-profit” model that limited investor returns. This was designed to help OpenAI raise the massive amounts of funding it needed to scale and attract top talent.
Musk’s lawsuit was unable to stop OpenAI from converting into a nonprofit, and in October 2025, the corporation completed its formal restructuring process. The for-profit branch became a Public Benefit Corporation, with the original nonprofit retaining a 26% equity stake.
Musk is now seeking monetary damages from what he says are “ill-gotten gains” by OpenAI. He says he invested about $38 million in early funding, as well as guidance and credibility, based on assurances that OpenAI would remain a nonprofit.
An OpenAI spokesperson told TechCrunch Musk’s lawsuit is “baseless and a part of his ongoing pattern of harassment.”
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District Judge Yvonne Gonzalez Rogers said her decision was based on evidence suggesting OpenAI’s leaders made assurances that its original nonprofit structure would be maintained, as Musk alleges. A jury trial for March has been tentatively scheduled.
This article has been updated with commentary from OpenAI.
