Elon Musk Testifies in OpenAI For-Profit Shift Trial

Elon Musk took the stand as the first witness in his civil trial against OpenAI and CEO Sam Altman in an Oakland federal court. The trial began Tuesday, with Musk accusing OpenAI of betraying its founding mission as a nonprofit dedicated to developing AI for public benefit.

He seeks more than $100 billion in damages and requests to unwind the company's for-profit structure. Musk testified that he co-founded OpenAI in 2015 alongside Altman and president Greg Brockman after discussions about AI risks. He donated $38 million to the organization, which was established as a nonprofit.

OpenAI later shifted to a for-profit model, with Microsoft holding a roughly 27% stake in the for-profit entity.

Musk described AI as a very smart child that needs the right values instilled to prevent it from running out of control. He cited a 2015 meeting with former President Barack Obama, where he spent an hour warning about AI dangers. Musk also recounted a 2015 conversation with then-Google CEO Larry Page, who called him a "speciesist" for prioritizing humans over AI.

Musk stated he founded OpenAI as a counterbalance to Google, which he said did not prioritize AI safety at the time. He testified about recruiting AI researcher Ilya Sutskever from Google to OpenAI. Musk left OpenAI in 2018 and launched his own AI startup, xAI, in 2023.

“I thought it was extremely important to have a counterbalance to Google.”

The lawsuit alleges Altman and Brockman deceived Musk into funding the nonprofit, then transformed it into a for-profit entity effectively subsidiary to Microsoft. OpenAI maintains that Musk agreed in 2017 to the need for a for-profit shift but left after demanding full control.

The company described the lawsuit as baseless. During opening statements, OpenAI attorney William Savitt said Musk lost a power struggle and is now motivated by rivalry, especially after starting xAI. Musk's attorney Steven Molo highlighted Musk's tech contributions.

The trial, expected to last about three weeks, involves a nine-person jury presided over by U.S. District Judge Yvonne Gonzalez Rogers. Musk testified that a loss would set a precedent harming charitable giving in America. He pledged to donate any damages to OpenAI's charitable arm.

Potential witnesses include Microsoft CEO Satya Nadella.

OpenAI was founded in 2015 with a mission to develop AI safely for humanity's benefit. By 2017, leaders discussed a for-profit arm for funding, but Musk said he insisted the nonprofit retain control. Last year, OpenAI restructured, shifting toward a conventional for-profit structure while keeping the nonprofit in control.

Musk referenced pop culture, contrasting a "Terminator" outcome with a "Star Trek" future for AI. He also discussed his brain-chip startup Neuralink as aimed at AI-human symbiosis for safety, and SpaceX as life insurance for humanity.

“It’s not okay to steal a charity." — Elon Musk, testimony on Tuesday (nypost.com). The case centers on claims of breach of contract and unjust enrichment. If liable, the judge will determine remedies, potentially including removing Altman and Brockman from leadership. OpenAI's valuation stands at about $850 billion, with reports of a potential IPO this year at $1 trillion. Musk's SpaceX acquired xAI in February and is preparing for an IPO that could value it at more than $2 trillion. The trial follows jury selection on Monday, during which Musk posted on X about the case, prompting judicial admonition to both sides.”