On Feb. 29, Elon Musk sued OpenAI CEO Sam Altman for breach of contract in San Francisco County, alleging the start-up company deserted its core mission of developing AI for the “benefit of humanity” and was instead focused on profit. Musk filed the lawsuit in California Superior Court, shining a light on the intense opposition between himself and Altman –who many refer to as the face of generative AI –as he is seen as an industry trailblazer for leading the Microsoft-backed company and creating one of the most popular GAI models –ChatGPT. Musk, arguably one of the biggest names in tech and the wealthiest man in the world –cofounded OpenAI in 2015 before leaving the firm’s board in 2018 to build his own AI start-up last July. Let’s get into the details.
Background
Back in November, OpenAI faced media scrutiny over the sudden firing of Sam Altman as CEO and reshuffling its board, ultimately reinstating Altman three days later amidst intense backlash. Now Altman’s name is back in the public eye as he faces a lawsuit filed by Elon Musk over concerns that OpenAI –which started as a non-profit back in 2015 –has strayed from its core mission of creating AI to benefit humankind and is instead focused on making a profit for the largest tech company in the world –Microsoft.
The lawsuit filing stated, “To this day, OpenAI, Inc.‘s website continues to profess that its charter is to ensure that AGI benefits all of humanity. However, OpenAI, Inc. has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft.” The lawsuit alleged that under the new Board, OpenAI breached its founding agreement because “it is not just developing but is actually refining […] AGI to maximize profits for Microsoft, rather than for the benefit of humanity. Its technology, including GPT-4, is closed-source primarily to serve the proprietary commercial interests of Microsoft.”
What Are the Causes of Action Alleged in the Complaint?
The complaint alleged five causes of action for (1) breach of contract, (2) promissory estoppel, (3) breach of fiduciary duty, (4) unfair business practices, and (5) accounting. The complaint asks the court to order OpenAI to “continue to follow [its] long-standing practice of making AI research and technology developed at OpenAI available to the public, and [for an] order [estopping] Defendants from utilizing OpenAI, Inc. or its assets for the financial benefit of individual Defendants, Microsoft, or any other particular person or entity.” Musk also seeks general, compensatory, and punitive damages from Defendants –stating that Plaintiff will contribute the damages to a non-profit or charity.
What Are the Broader Implications for the AI Community?
With two of the biggest names in tech pitted against each other, this lawsuit represents a more significant debate in the tech community over AI’s future potential and the new technology’s risks. If Musk is successful in court, a ruling could potentially “compel OpenAI to make its research and technology available to the public and prevent the start-up from using its assets, including GPT-4, for financial gains by Microsoft or any individual.” Are Musk’s intentions purely altruistic? Or, is it possible he is concerned that Microsoft-backed OpenAI has such a lead over the AI industry that companies like his own AI start-up will be unable to compete in a market dominated by Microsoft –the most powerful tech company?
The lawsuit also addresses fear in the tech community that the rapid development of AI technology facilitates risks to society if it is not developed responsibly, with mechanisms in place to safeguard people’s privacy. Courts nationwide have grappled with AI developments in the past year as technological advancements raise many new legal concerns that lawmakers must address.
As Elon Musk continues to warn the world of the dangers AI poses, Sam Altman is on the other side of the debate and continues to be a significant promotor of AI’s development, speaking publicly about the benefits AI can bring to society, such as access to justice and advancements in healthcare. Be sure to check back in with our blog to see how this case plays out and what impact, if any, it has on advancing AI technology.
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For a more in-depth look into this case and to read the full complaint, check out Trellis! Trellis is an AI-driven, state trial court research and analytics platform. We make the fragmented U.S. state trial court system searchable through a single interface, offering comprehensive insights into judges, cases, and opposing counsel. Effortlessly track lawsuits across states and stay updated with ongoing litigation documents. Request a demo today and elevate your legal practice with our intuitive analytics and API.
Sources:
https://trellis.law/case/cgc24612746/elon-musk-vs-samuel-altman-et-al
https://www.cnbc.com/2024/03/01/elon-musk-sues-openai-and-ceo-sam-altman-over-contract-breach.html
https://www.reuters.com/legal/elon-musk-sues-openai-ceo-sam-altman-breach-contract-2024-03-01
Music: Disruptor’s Dance by Anka Mason
Blog Narration: Anka Mason
