OpenAI Board Member Testifies in Musk Lawsuit Over Company Restructuring

A former OpenAI board member testified for hours on Wednesday in a federal courtroom in Oakland, California as a key witness in Elon Musk’s lawsuit against the artificial intelligence company. The executive described both her professional involvement in early talks about OpenAI’s corporate structure and her unconventional personal relationship with Musk that produced four children.

The witness joined OpenAI as an adviser in 2016 shortly after its founding and first met Musk through that role. She later served on the board from 2020 until March 2023. During her testimony she explained that Musk offered in 2020 to donate sperm after noticing she had not had children.

She said she accepted the offer because she still wanted to become a mother while dealing with health issues that altered her plans for a traditional family. She told the court the initial arrangement with Musk was for him to have a limited role in the children’s lives and for his paternity to remain strictly confidential.

The two later had two more children together. She said Musk is now an active participant in their lives and the family spends a few hours together each week. The witness did not disclose Musk’s paternity of the twins born in 2021 to OpenAI’s CEO when she learned she was pregnant.

She informed him the following year only after learning a news report on the matter was imminent. The CEO and company president nevertheless chose to keep her on the board and the three remained friends at least until 2023. OpenAI has argued in the case that the witness served as an informant for Musk after he left the company in 2018.

The company’s lawyers highlighted her continued work across Musk’s companies while she held a board seat at OpenAI. She left the board as Musk launched a competing artificial intelligence venture.

Court exhibits showed that moving OpenAI away from a pure nonprofit model was viewed as necessary by 2017 to raise the billions of dollars required for growth. The witness was involved in written exchanges about possible structures including a B Corp entity that would remain mission-oriented while allowing investment.

Musk pushed for greater control through additional board seats and at one point suggested OpenAI could become part of his electric car company as a B Corp subsidiary. The witness wrote in one exchange that such a move would solve the funding issue immediately.

OpenAI’s CEO, president and another co-founder ultimately could not agree on terms with Musk because they were adamant he not gain control of the company’s work. The lawsuit filed by Musk alleges that the CEO and president broke a founding agreement when they restructured OpenAI into a for-profit enterprise.

He is seeking to reverse that change, have both executives removed from their positions, and have $134 billion in damages redirected to the nonprofit arm. >"I still really wanted to be a mum and Elon made the offer around that time and I accepted. He was encouraging everyone around him at that time to have kids and he'd noticed I did not.

She said the confidentiality agreement explained why she initially withheld information about the children’s paternity from OpenAI leadership. The company’s president told reporters earlier this week that board members trusted the witness to manage the conflict of interest involving Musk.

Lawyers for OpenAI seized on emails and text messages exchanged among the witness, the CEO, the president and Musk that touched on corporate structure changes. The testimony provided the most detailed public account yet of how personal and professional relationships overlapped at the highest levels of the artificial intelligence industry’s leading organizations during a period of rapid growth and intense competition.

The trial is expected to continue with additional witnesses and evidence drawn from years of internal communications.