Elon Musk and OpenAI head to court to spar over nonprofit conversion

Elon Musk and OpenAI are heading to court over OpenAI's plans to convert from a nonprofit to a for-profit entity. Musk, who co-founded OpenAI in 2015 but left in 2018, claims that the conversion would betray the company's original mission to develop AI for the benefit of humanity. 

Musk's lawsuit alleges that OpenAI's CEO, Sam Altman, and other defendants are engaging in self-dealing and anticompetitive behavior, including discouraging investors from backing rival AI companies like Musk's own xAI. Musk is seeking an injunction to halt OpenAI's conversion, which he claims would harm the public interest and allow the company to prioritize profits over its original mission.

OpenAI, on the other hand, argues that the conversion is necessary to secure the capital needed to develop the best AI models. The company has reportedly secured $6.6 billion in funding and is discussing a new round of up to $25 billion with investors like SoftBank. 

The court hearing, scheduled for today, will determine whether OpenAI can proceed with its plans to convert to a for-profit entity. The outcome could have significant implications for the future of AI development and the role of nonprofit organizations in the tech industry.

https://www.reuters.com/legal/elon-musk-openai-head-court-spar-over-nonprofit-conversion-2025-02-04/