Attorney General Says Musk’s Legal Action Lacks Public Benefit
The California attorney general’s office has declined to support Elon Musk’s lawsuit against artificial intelligence firm OpenAI. In a letter released on Tuesday, the office said Musk had not shown how the case serves the public interest of the state.
Musk, a co-founder of OpenAI, is currently locked in a dispute with fellow co-founder and OpenAI CEO, Sam Altman. The legal battle revolves around OpenAI’s proposed structural shift, which includes removing the nonprofit board’s control in favour of equity-driven investor interests.
The attorney general’s letter, dated Monday, stated that Musk’s claims failed to demonstrate a clear public benefit. It also noted concerns that Musk appeared to be seeking control over OpenAI’s charitable assets for personal gain. This follows Musk’s unsolicited $97 billion offer, made in February through a consortium, to take control of OpenAI.
California Attorney General’s Office Remains a Key Figure
In response, Musk’s legal team said the attorney general misunderstood the nature of his offer. They stated that Musk has no intention of acquiring OpenAI if it retains its current nonprofit status. Musk’s team also pointed to growing public concern over OpenAI’s transition to a for-profit model, arguing that the move undermines its original mission.
“People from across the political spectrum are objecting to OpenAI’s unlawful conduct and its planned for-profit conversion,” Musk’s lawyer wrote. He added that support has come from former OpenAI staff and coalitions of labour and charitable groups.
Despite declining to join the lawsuit, the California attorney general’s office remains a key figure in the matter. As the state regulator for nonprofits, it must still approve OpenAI’s proposed structural changes.
OpenAI Aims to Secure Major Investment
OpenAI argues that restructuring is essential for raising capital. The firm says eliminating the nonprofit board’s control is required to finalise a $40 billion investment round by the end of the year. It maintains that the nonprofit arm will retain an equity stake in the company, which will grow in value and fund its original mission.
Founded in 2015 by Musk and Altman, OpenAI began as a nonprofit with the mission of ensuring AI development benefits humanity. Musk departed the company before it rose to prominence with tools like ChatGPT. In 2023, he launched a competing AI company, xAI.
Musk has accused OpenAI of shifting away from its founding mission to focus on profit. OpenAI and Altman deny the claims. The case is expected to go to a jury trial in spring 2026.
Altman has suggested that Musk’s legal actions are intended to slow down a major competitor in the fast-growing AI sector.
with inputs from Reuters
