Elon Musk's lawsuit against OpenAI's for-profit transition worthy of trial, says US judge
Musk alleges that OpenAI violated its founding mission during transition to a for-profit status
January 08, 2026
In a move illustrating a tough time ahead for OpenAI, the ChatGPT developer, a US judge has nodded to tech bellwether Elon Musk's trial over his lawsuit against OpenAI's transition to become a for-profit entity.
Musk alleges that OpenAI violated its founding mission during the status shifting, and while he co-founded OpenAI in 2015 but left in 2018, he now heads xAI, an AI company that competes with OpenAI.
U.S. District Judge Yvonne Gonzalez Rogers, presiding in Oakland, California, ruled during a hearing that there was “plenty of evidence” suggesting that OpenAI’s leadership had assured stakeholders that its original nonprofit structure would be preserved.
He added that the existence of disputed facts validated a jury's consideration of the claims at a trial set for March 2026, rather than resolving the issues herself. She is expected to issue a written order addressing OpenAI's request to dismiss the case.
The legal battle progresses amid a growing competition for dominance in the realm of artificial intelligence (AI), with xAI and its chatbot Grok striving against OpenAI and other tech developers.
Through the lodge of the petitions in questions, Musk is seeking unspecified monetary damages, referring to OpenAI's actions as "ill-gotten gains."
In response, OpenAI characterised Musk's lawsuit as baseless and part of a pattern of harassment, expressing eagerness to demonstrate this in court.
Musk alleged that he contributed approximately $38 million—around 60% of OpenAI's initial funding—based on assurances that the organisation would be dedicated to public benefit by remaining a nonprofit.
The lawsuit accuses OpenAI co-founders Sam Altman and Greg Brockman of plotting to switch to a for-profit model to enrich themselves, resulting in hefty deals with Microsoft. These claims were refuted by OpenAI and its founders, asserting that Musk is merely a frustrated competitor attempting to impeded a driven AI contender in the market.
