A federal jury rules Elon Musk waited too long to sue OpenAI, ending the high-stakes trial and sparing the ChatGPT startup from a potential restructuring.
OAKLAND: A federal jury ruled Monday that Elon Musk waited too long to sue OpenAI and its co-founders, delivering a decisive victory to the ChatGPT startup and ending one of Silicon Valley’s most closely watched courtroom battles.
The swift decision caps a three-week trial that saw a parade of tech titans take the stand, with Musk arguing that OpenAI’s pivot to a profit-driven business betrayed its original nonprofit mandate.
The jury in Oakland federal court found that Musk’s claims against OpenAI CEO Sam Altman, President Greg Brockman, The OpenAI Foundation and Microsoft were barred by statutes of limitations, leaving the billionaire’s core arguments largely unaddressed.
Judge Yvonne Gonzalez Rogers, who had asked the jury to advise her on the matter, accepted and confirmed their decision.
‘Sabotage’
The outcome spared OpenAI from a potentially existential legal threat.
Had Musk prevailed, he was seeking to force the company to revert to its nonprofit structure — a move that would have derailed its planned IPO and unwound ties to major investors including Microsoft, Amazon and SoftBank.
“The finding of the jury confirms that this lawsuit was a hypocritical attempt to sabotage a competitor,” OpenAI attorney William Savitt said outside the courthouse.
“Musk can bring his claims, and he can tell his stories, but what the nine members of this jury found is that his stories were just that — stories, not facts,” he added.
Musk, the world’s richest person, had sued OpenAI over its transformation from a scrappy nonprofit into the $850 billion juggernaut behind ChatGPT, claiming Altman and Brockman improperly used a $38 million donation intended to sustain OpenAI as a research lab devoted to developing AI for the benefit of humanity.
But in their deliberations, the jury first had to resolve a threshold issue of whether Musk, who filed suit in 2024 — four years after his last contribution — had done so within the statutory time limit.
Musk on X said he would appeal the case as the “jury never actually ruled on the merits of the case” and that to “loot charities is incredibly destructive to charitable giving in America.”
The Tesla tycoon also lashed out at Judge Gonzalez Rogers for setting a “terrible precedent,” accusing her of being an “activist judge” who used the jury as a “fig leaf” for a flawed ruling she could have made herself.
‘Soap opera’
The outcome had largely been expected to come down to which of the bickering billionaires the jury would believe.
Testimony centered heavily on Altman’s integrity and behind-the-scenes maneuvering that rankled colleagues, many of whom have since left OpenAI.
OpenAI’s attorneys countered with attacks on Musk, pointing to his varying narratives about the early days of the company and parsing testimony from Shivon Zilis — a business associate with whom he has four children — who served as an intermediary between the executives.
Altman, fired by OpenAI’s board in November 2023 for a lack of candor before being reinstated under employee pressure, emerged with allegations of manipulation and a toxic work culture unresolved.
Microsoft, OpenAI’s largest backer with $13 billion committed, was also spared.
“This is an important victory for Altman and OpenAI and clears the path for an IPO by removing this black cloud,” Dan Ives of Wedbush Securities told AFP.
“Musk was creating noise around this lawsuit but ultimately it was more of a soap opera than a long-term negative for OpenAI,” he added.
