UPDATED 14:36 EST / MARCH 01 2024

AI

Elon Musk sues OpenAI and Sam Altman over alleged breach of contract

Elon Musk is suing OpenAI and its Chief Executive Sam Altman for allegedly failing to uphold an agreement inked at the time of the artificial intelligence group’s launch.

Musk, who was part of OpenAI’s founding team, filed the lawsuit on Thursday with the San Francisco Superior Court. The Tesla Inc. CEO is seeking a ruling that would require the AI group to uphold the agreement at the focus of the litigation. Additionally, Musk has asked the court to determine whether GPT-4 might qualify as an artificial general intelligence, which could have implications for OpenAI’s partnership with Microsoft Corp.

OpenAI launched in 2015 as a nonprofit AI research group. At the time, Musk and other prominent tech executives committed more than $1 billion in donations to support its work. The Tesla CEO held a board seat until 2018, when he reportedly left in the wake of an unsuccessful takeover attempt. 

In his lawsuit, Musk charges that Altman and OpenAI President Greg Brockman agreed the AI developer would adhere to a “founding agreement.” This agreement allegedly specified that OpenAI would operate as a “non-profit developing AGI for the benefit of humanity, not for a for-profit company.” Additionally, the complaint states that the AI developer committed to open-sourcing its work except in cases where safety considerations might warrant taking a different approach.

Musk accuses OpenAI of breaching the founding agreement. The lawsuit alleges that, despite committing to operate as a nonprofit with a focus on open-source research, the AI developer has “transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft.”

OpenAI launched a for-profit arm in 2019 that raised $1 billion from Microsoft later that year. Last January, the AI developer reportedly received an additional $10 billion from the cloud computing and software giant. The companies also maintain a technical partnership that has seen Microsoft integrate OpenAI’s models into several of its products.

“This case is filed to compel OpenAI to adhere to the Founding Agreement and return to its mission to develop AGI for the benefit of humanity, not to personally benefit the individual Defendants and the largest technology company in the world,” Musk’s lawsuit states.

The Tesla CEO is also asking the court to decide whether GPT-4, OpenAI’s latest large language model, should be considered an AGI. Microsoft’s partnership with OpenAI only allows the former company to license models that don’t meet this criterion. Potentially, a ruling that finds GPT-4 qualifies as an AGI could influence Microsoft’s ability to include the LLM series in its products.

Recent reports indicate OpenAI is developing a new language model dubbed Q* with more advanced capabilities than GPT-4. Musk’s lawsuit argues that, under the terms of the AI developer’s founding agreement, it may have to make the upcoming model publicly available.

Last June, Musk launched an AI startup called xAI Inc. that competes with OpenAI. The company’s first product is a ChatGPT-like chatbot called Grok that can answer natural language questions, generate code and perform related tasks. Regulatory filings indicate that xAI has raised at least $135 million in venture funding. 

Photo: NASA/Wikimedia Commons

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