Why Is Elon Musk Suing OpenAI?
Lawyers for the Tesla CEO claim that the ChatGPT creator’s partnership with Microsoft is causing the company to transform “into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft,” (via Business Insider).
Source: James Duncan Davidson
OpenAI and Microsoft partnered up from a commercial standpoint in 2016 and consolidated in 2019, with Microsoft investing a billion dollars into the partnership.
The Lawsuit Claims OpenAI Has Breached its Contract
The lawyers added to their lawsuit, “Under its new board, it is not just developing but is refining an AGI to maximize profits for Microsoft, rather than for the benefit of humanity.”
Source: Wikimedia Commons
The lawsuit was filed on Thursday, Feb. 29, 2024, and named former OpenAI CEO Altman and co-founder Greg Brockman as the defendants. The lawyers also claimed that the company’s new direction toward a “capped-profit” division breached its contract of being an open-source, nonprofit organization.
OpenAI Became a Hybrid Company in 2019
The lawsuit quotes OpenAI’s founding agreement, stating: “Resulting technology will benefit the public and the corporation will seek to open source technology for the public benefit when applicable. The corporation is not organized for the private gain of any person.”
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In 2019, the AI company created OpenAI LP, a for-profit and nonprofit hybrid corporation. A blog post at the time said the idea was for investors and employees looking for a “capped return” if a product was successful. The company then added that it would give additional returns to its nonprofit entity.
OpenAI’s Nonprofit Status Changes
OpenAI’s nonprofit status has also been a major source of friction for Musk. He pushes to keep the company’s AI technology in the research lab, its original purpose, while executives focus on potential financial gains.
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Musk helped create OpenAI with Atlman and others in 2015. The SpaceX CEO left OpenAI’s board in 2018, criticizing the company’s lack of focus on AI risks. It was around Musk’s departure that OpenAI created ChatGPT and Musk created his own AI company, xAI.
Musk Wasn’t Informed About GPT-4 Before Leaving
The lawyers argued that OpenAI kept GTP-4 “a complete secret” from Musk, who had been vocal about artificial general intelligence posing “a particularly acute and noxious danger to humanity” when in the hands of a for-profit company such as Google or Microsoft.
Source: Focal Foto/Flickr
Despite Musk’s fear, Silicon Valley insiders believed that generative AI, the tech behind ChatGPT, could transform the entire tech industry through a web browser. They urged the exploration of avenues for using and integrating this powerful AI model.
Altman Was Dismissed from OpenAI in 2023
The OpenAI board of directors abruptly dismissed Altman from his position as CEO in November 2023. OpenAi’s board of directors cited that the lack of transparency and communication was the grounds for Altman’s removal.
Source: Sam Atlman/X
While this news sent a ripple through the AI world, it sparked questions regarding how the company was practicing its core mission to benefit humanity.
Musk Criticized the Ownership Structure at OpenAI
Musk has been critical of OpenAI’s ownership structure and its shift to focus on profit. In November 2023, Musk commented on the corporate structure after Altman revealed himself to be OpenAI’s CEO, writing: “OpenAI being (semi) independent is probably better for the world than merging with Microsoft. Less concentration of power.”
Source: Wikimedia Commons
“It isn’t clear to me how the OpenAI structure is legal at all,” Musk wrote on X last month, adding that he was offered shares at “various points, but it seemed unethical/illegal to accept them.”
Microsoft Speaks Out Against Musk’s Initial Comments
Microsoft CEO Satya Nadella commented on Musk’s remarks in January, stating that the Tesla CEO didn’t have any issues with OpenAI’s ownership structure. Instead, Nadella believes that Musk wanted to have “good governance.”
Source: Sanket Mishra/Pexels
However, the lawsuit showcases the many problems the SpaceX CEO has with OpenAI attempting to profit off technology that could endanger humanity.
OpenAI Has A Lot Going On… and Not in a Good Way
OpenAI is no stranger to lawsuits. The New York Times, several digital outlets, writers, computer programmers, and artists have sued the AI company for scraping copyrighted material to train its chatbot.
Source: Wikimedia Commons
On top of the pile of lawsuits, the company’s relationship with Microsoft has faced criticism from regulators in the United States, European Union, and Britain.
Musk Is Seeking a Jury Trial
The lawsuit is seeking a jury trial. The jury will decide on whether or not OpenAI has breached its contract and violated fiduciary duty, as well as violating fair business practices.
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Musk demands that OpenAI open up its technology to others and that Altman and others repay Musk the money he gave to the organization.
Musk Warns That OpenAI Might Have Found Something “Dangerous”
At The New York Times’s DealBook Summit last year, Musk wanted to know more about why the co-founder and board members at OpenAI fired Altman in November, bringing up his concern that OpenAI may have discovered some dangerous elements of AI.
Source: James Duncan Davidson
“I have mixed feelings about Sam,” Musk said at the DealBook conference (via The New York Times). “The ring of power can corrupt, and [Altman] has the ring of power.”