The legal battle between OpenAI and Elon Musk has become one of the most closely watched tech disputes in recent years. What began as a shared mission to build artificial intelligence for public benefit has now turned into a public fight involving lawsuits, countersuits, corporate ambitions, and deep personal disagreements. The case has attracted attention not only because of the people involved but also because of what is at stake—control over one of the world’s most influential AI firms.
OpenAI was co-founded in 2015 by a group of tech leaders and researchers, including Elon Musk and Sam Altman. The company’s original mission was to develop artificial intelligence in a way that would benefit all of humanity, not just a select group of corporations or governments. At the time, it was set up as a non-profit to help maintain that direction. Musk was a strong supporter of this approach and helped fund the early operations. However, tensions began to rise within the organization in the following years, especially as the scope and ambition of OpenAI’s projects expanded.
Elon Musk stepped away from the company in 2018, citing disagreements over the company’s direction and possible conflicts with his own companies, particularly Tesla’s AI work. After his departure, OpenAI went through a key structural change. It established a new model in 2019 known as the “capped-profit” system. Under this arrangement, OpenAI LP could attract external investments while still keeping its original mission through the oversight of a nonprofit board. The change allowed OpenAI to raise the large sums of money needed to compete in a growing AI race, including major funding from Microsoft.
The disagreement reached a new level in August 2023 when Elon Musk filed a lawsuit against OpenAI, Sam Altman, and co-founder Greg Brockman. In the lawsuit, Musk claimed that OpenAI had strayed from its founding principles and was now prioritizing profit over public benefit. He accused the company of breaching its original agreement and shifting too much control to private investors. Musk was especially critical of the company’s close partnership with Microsoft, arguing that it gave a large corporation too much influence over what was supposed to be a neutral and open project.
Following Musk’s lawsuit, OpenAI responded in March 2025 by filing a countersuit. The company accused Musk of using dishonest tactics to slow down OpenAI’s progress for his own benefit. In their court filing, OpenAI stated that Musk had tried “every tool available” to hurt the company, including launching public attacks, press campaigns, and demands for internal records. The countersuit described Musk’s behavior as a pattern of harassment and asked the court to stop him from continuing what they see as a harmful campaign.
OpenAI also alleged that Musk made an unsolicited offer to buy out the company’s nonprofit division for $97.4 billion. According to OpenAI, this bid was never seriously considered because it conflicted with the company’s structure and goals. Altman publicly rejected the offer and even joked on social media that OpenAI would consider buying Twitter instead, referencing Musk’s earlier purchase of the platform.
The court filings have made it clear that both sides view the conflict in very different terms. Musk presents himself as someone trying to protect the original mission of OpenAI. He claims that the company has become something he never agreed to be part of—a tool for corporate gain. OpenAI, on the other hand, sees Musk as someone who left the company years ago and is now trying to take back control, not for the public good, but to benefit his own ventures like xAI.
The case has continued to escalate. A judge in the Northern District of California ruled that the case would go to trial in March 2026. Both sides had earlier agreed to a fast-track schedule to resolve the dispute. The judge also denied Musk’s request to temporarily stop OpenAI’s conversion to a for-profit model, stating that there was no legal basis for such an order at this stage. Musk is expected to testify in the case, and both parties are preparing for a lengthy legal fight.
At the heart of the case is a larger debate over the direction of AI development. As AI becomes more powerful and widespread, there is increasing pressure to ensure that its development remains safe, fair, and accountable. OpenAI has tried to balance its nonprofit mission with the need to raise enough money to stay ahead in a fast-moving field. Critics argue that this balance has failed, and the company is now more focused on business than ethics. Supporters say the capped-profit model is a necessary compromise that allows innovation while maintaining oversight.
Meanwhile, Musk has been building his own AI company, xAI, which he launched in 2023. Though it has not reached the same level of public attention as OpenAI, xAI is working on its own tools and models, and has been integrated with X (formerly Twitter). Musk believes that AI should be developed in a more open and transparent way, though critics have pointed out that his own approach to business often involves strong control and limited outside input.
There is also a broader tension between public and private interests in the AI sector. Large companies like Microsoft, Google, and Meta are investing heavily in artificial intelligence, hoping to shape the future of the technology. At the same time, many researchers and policymakers worry that too much power is ending up in the hands of a few firms. The OpenAI–Musk lawsuit reflects that struggle, as it centers on who should control advanced AI systems and what values should guide their development.
In its court filings, OpenAI made it clear that it sees Musk’s actions as harmful, not helpful. It said that Musk’s repeated attempts to gain control of the company are not about mission but about personal ambition. They argue that he left the organization voluntarily and has no legal right to interfere in how it is now run. The filing also notes that Musk has been spreading false and misleading information to damage the company’s reputation.
Musk’s lawyers have said that the court should take his claims seriously and that OpenAI’s board failed to consider his takeover bid in good faith. They argue that the board is acting in its own interest and has not fulfilled its duties to the public. According to Musk’s legal team, the original agreement that created OpenAI still matters and should guide how the company operates today.
The outcome of the trial could affect not just OpenAI and Musk but the entire AI sector. If the court finds in favor of Musk, it could lead to tighter rules on how companies shift from nonprofit to for-profit status. It could also raise questions about transparency and accountability in tech governance. On the other hand, if OpenAI wins, it may strengthen the view that mission-driven companies can still operate within market systems without losing their values.
The case also shows how personal and professional disagreements can shape the direction of major technologies. Musk and Altman were once close partners with a shared goal. Now, their disagreement has become public and legal. It is a reminder that the people leading major tech projects often have different ideas about how things should be done.
As of now, the court case is ongoing, and more information will come out as both sides present their arguments. The trial is scheduled for early 2026, but developments are expected throughout 2025. Whatever the result, the case is likely to remain a key moment in the story of artificial intelligence and its place in society.
