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Musk Suing OpenAI for Billions

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The Judge Couldn't Help Laughing

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In the morning, he declared on the witness stand:

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"I never shout."

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By the afternoon, he was yelling at the lawyers in court.

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The judge broke into a laugh,

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and the jurors all looked up at him.

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Less than four hours had passed between those moments.

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Hello,

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everyone,

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I'm Wang Lijie.

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Just last week,

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in a federal courtroom in Oakland, California,

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what might be the most important tech lawsuit of our era officially began.

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The Plaintiff:

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Elon Musk.

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The Defendants:

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OpenAI,

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its CEO Sam Altman,

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and co-founder Greg Brockman.

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Jury selection alone was a spectacle.

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The court needed to pick nine people from the candidate pool.

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One candidate said right to Musk's face

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that he's a greedy, racist, homophobic piece of trash.

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Another called him a world-class jerk.

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The judge had to repeatedly remind them,

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"Please remain objective."

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The nine selected jurors

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mostly claimed no strong feelings toward Musk or AI.

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But think about it:

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A man walks into court,

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and before he even speaks,

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potential jurors are already lining up to insult him.

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This is quite rare even in American legal history.

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The damages sought?

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Over $130 billion.

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What does that look like?

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Roughly half the annual GDP of all countries worldwide.

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And Musk wants more than just money.

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He wants the court to force OpenAI back into a non-profit,

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remove Altman and Brockman from all positions,

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and block OpenAI's IPO scheduled for later this year.

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His core allegation can be summed up in one sentence:

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"They stole a charity."

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The story begins in 2015.

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That year,

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Musk, Altman, and others co-founded OpenAI,

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a non-profit research lab determined not to seek profit

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but to develop AI for all of humanity.

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Musk testified in court,

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"I came up with the name.

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I recruited the core team.

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I taught them everything I know.

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I provided all the initial funding."

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But OpenAI's lawyer did some math right there:

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A pledge of $1 billion,

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but only $38 million actually paid.

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That's a fulfillment rate of less than 4%.

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Musk grew defensive,

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shouting,

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"Without me, OpenAI wouldn't exist.

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I contributed my reputation.

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Those things have value."

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The lawyer followed up,

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"So exactly how much money was donated?"

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Musk had to admit,

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"In a strict monetary sense,

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it was $38 million."

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How do you describe this scene?

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It's like someone at a dinner party bragging they'll treat everyone,

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only to offer 'spiritual support' when the bill arrives.

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But don't laugh at Musk just yet,

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because his anger isn't entirely baseless.

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Today's OpenAI

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is valued at over $850 billion.

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Regardless of who paid what initially,

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a non-profit turning into such a massive commercial empire

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definitely raises a huge question mark.

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In court, Musk used a vivid metaphor for this,

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calling it "the tail wagging the dog."

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He said OpenAI's original design

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was a non-profit 'dog' with a for-profit 'tail.'

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The tail only existed to secure funding

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and to serve the dog.

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But now it's completely reversed.

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The for-profit arm has sucked up all talent, capital, and focus.

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The non-profit is just a legal shell,

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occasionally used as a storefront.

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This metaphor is actually quite accurate.

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And Musk has a key text message as evidence.

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In 2022,

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Microsoft announced a $10 billion investment.

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OpenAI's valuation soared to $20 billion overnight.

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Musk texted Sam Altman,

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saying this felt like a bait-and-switch.

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He meant: you used the non-profit mission

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of benefiting all humanity to lure me in.

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Once the company succeeded, I realized

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that was never what you actually intended to do.

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How did Altman respond?

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He said,

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"I agree."

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"It does feel bad."

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Musk's lawyers highlighted this text in court.

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See?

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Even Altman himself admitted it felt wrong.

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Isn't that evidence enough?

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But the problem is,

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when OpenAI's lawyers started fighting back,

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Musk's own past was exposed layer by layer.

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And the person doing the exposing—

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his background is a drama in itself.

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OpenAI's lead counsel is William Savitt.

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He used to be Musk's lawyer,

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helping him with Tesla's litigation.

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Later,

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he switched sides.

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Representing Twitter's executives,

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he won the lawsuit that forced Musk

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to complete the $44B acquisition of Twitter.

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Now,

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he appears for the third time,

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standing opposite Musk to represent OpenAI.

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No one knows better how to handle this witness.

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Savitt's strategy is brutal.

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He doesn't present new evidence;

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he uses Musk's own words—

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emails and videotaped depositions—

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to dismantle everything Musk said in court.

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The first blow was the truth behind his departure.

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Musk always told the public

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he left the OpenAI board in 2018

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to avoid a conflict of interest with Tesla.

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Savitt pushed for more detail.

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Musk's lawyers objected.

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The judge overruled it,

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allowing the questioning to continue.

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Finally, Musk was backed into a corner

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and admitted it.

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In 2017, he demanded from the other founders

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51% of equity

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and four board seats,

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while all other founders combined had only three.

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When rejected,

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he cut off funding

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and pooped OpenAI's core researcher,

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Andrej Karpathy, to Tesla.

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He left

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not because of a conflict of interest,

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but because he didn't get what he wanted.

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This truth is fatal to Musk's narrative,

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as he'd blamed conflicts of interest for a decade.

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The second blow targeted the roots of for-profit shift.

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Savitt produced emails written by Musk himself.

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In 2015,

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before OpenAI was even announced,

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Musk suggested adding a for-profit entity.

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In 2016,

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he emailed colleagues saying,

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"Making it a non-profit might be a mistake."

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In 2017,

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he instructed a senior advisor to secretly use the OpenAI name

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to register a for-profit company.

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In 2018,

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he emailed the other founders,

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claiming OpenAI was doomed to fail.

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The solution, he said, was a merger with Tesla.

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Do you see the problem?

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Musk is suing OpenAI today for betraying its non-profit mission,

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yet he’s been pushing for monetization since 2015.

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There's only one difference:

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the monetization he wanted

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was monetization under his control.

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Monetization by anyone else

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is "betrayal."

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The third blow was the most lethal.

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Savitt asked,

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"Did your company, xAI, use distillation techniques

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to extract knowledge from OpenAI's models to train Grok?"

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Musk first dodged the question,

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saying distillation is common practice among AI companies.

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Savitt pressed him,

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"Did xAI do it or not?

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Yes or no?"

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Musk replied,

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"In part, yes."

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A man suing others for stealing,

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admitting in court that he is also stealing from them.

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In legal terms, this is called "unclean hands."

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It means if your own hands are dirty,

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you can't easily accuse others of being messy.

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This admission was made on a federal witness stand,

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and its legal consequences could go far beyond this lawsuit.

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Then there was another scene,

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the most tense moment of the entire trial.

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Savitt pulled out a 2018 term sheet

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and asked Musk if he had read it.

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Musk told the court

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he had read the beginning

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and had a general idea of the contents.

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Savitt immediately played Musk's pre-trial video deposition.

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In the video, Musk was asked the same question

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but never mentioned reading the beginning.

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Two versions of Musk

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appeared before the jury at the same time.

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Musk became agitated,

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shouting his defense:

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"I said I didn't look at it carefully,

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not that I didn't read it!"

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This argument lasted several minutes.

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As Musk's voice grew louder,

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the judge told him to answer the question directly.

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Savitt kept pressing.

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Musk pointed at him and said,

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"Your questions aren't simple 'yes' or 'no'—

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they are designed to trick me!"

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This was Musk at his most emotional.

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Next was the "model card" incident.

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Savitt asked Musk,

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"Do you know what a model card is?"

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A model card is a safety document AI companies release with a model,

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disclosing capability boundaries, risks, and safety test results.

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It's a basic transparency standard in the AI industry.

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Musk said,

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"Not exactly sure,"

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even though his own company, xAI, issues them for Grok.

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He's suing OpenAI as a champion of AI safety,

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yet doesn't know the name of the safety files his own company uses.

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After these three days,

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one reporter observing the trial wrote in their notebook:

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"I've never felt so sympathetic toward Sam Altman in my life."

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But...

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don't be too quick to pity Altman.

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Because OpenAI has its own skeletons in the closet.

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The biggest landmine

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is Greg Brockman's private diary,

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unearthed during the discovery phase.

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In 2017,

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OpenAI was burning through cash rapidly,

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and internal talks began about switching to a for-profit structure to raise more funds.

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Musk was the biggest donor,

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but his condition was full control.

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Brockman and Altman didn't want to accept,

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but they didn't dare refuse him to his face.

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So their strategy was:

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keep placating Musk in person, promising to stay non-profit,

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while looking for another way out in private.

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Brockman wrote a passage in his diary:

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He said,

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he couldn't claim to Musk that they would stay non-profit

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if they were going to turn into a for-profit in three months.

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"That would be a lie."

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He knew very well

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that Musk's narrative would be:

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We were ultimately dishonest with him;

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we always wanted to go for-profit,

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we just didn't want him along for the ride.

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There's another sentence in that same diary:

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"Financially,

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what gets me to a billion?"

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Talking about the mission,

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while calculating personal net worth.

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This was the true mindset of the OpenAI co-founders

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back in 2017.

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The judge directly cited this diary in a January ruling

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as core evidence that the case should move to trial.

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Next, Brockman will have to take the witness stand

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to explain every word he wrote.

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The court also revealed an eye-opening set of text messages.

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In December 2024,

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Zuckerberg messaged Musk,

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stating Meta had written to the California Attorney General

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in support of his lawsuit against OpenAI.

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Two people who usually mock each other

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were now aligned because of a common rival.

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In February 2025,

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Musk sent a message to Zuckerberg:

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"Would you be willing to join me and a few others

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in a joint bid for OpenAI’s intellectual property?"

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Zuckerberg replied,

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"Let's hop on a call."

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Musk said okay,

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"Tomorrow morning."

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Ultimately, Zuckerberg did not participate.

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Seven days later,

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Musk bid $97.4 billion alone

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to acquire all of OpenAI.

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On the witness stand,

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Musk swore he made this bid

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to stop them from "stealing a charity."

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But the texts show

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his first instinct was to recruit another tech giant for a joint bid.

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Was this saving a charity,

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or a business acquisition?

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Savitt closed his cross-examination with one sentence:

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"He only supports a non-profit

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if he's the one in control."

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At this point, you might think,

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"Isn't this just rich people fighting?

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What does it have to do with me?"

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But the most interesting part of this trial

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is not who wins or loses.

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It's like an X-ray machine,

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revealing something much deeper.

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When these people founded OpenAI in 2015,

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what did they say?

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"For all humanity."

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"Not for profit."

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"Open source."

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"Against Google's monopoly."

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Doesn't that sound ironic today?

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But I truly believe that when they said those things,

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it was at least partially sincere.

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Musk was indeed worried about AI safety;

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he warned in 2014 that AI could be more dangerous than nukes.

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Altman did want to build a different kind of lab;

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in his first email to Musk in 2015,

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he laid out a very specific plan and mission.

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The problem is,

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sincere original intentions don't preclude how things eventually play out.

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Many betrayals aren't premeditated;

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they happen step by step.

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Each step seems reasonable at the time,

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yet in hindsight, you've reached the opposite of your starting point.

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When this lab actually created ChatGPT,

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and it became worth hundreds of billions,

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original intentions were no longer enough.

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It's like two people planting a tree together.

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When they planted it, they agreed:

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this tree is for the whole village to enjoy the shade.

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But the tree grew into a giant,

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covered in golden apples.

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Musk says, "I watered this tree,

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it should be under my control."

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Altman says, "You only provided 4% of the water,

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we were the ones who grew it."

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But no one mentions the original promise anymore:

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that this tree

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was for the whole village to enjoy.

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This isn't just a Silicon Valley story;

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it's a fundamental program of human nature.

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When there are no interests involved,

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it's easy to be noble.

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But when the stakes are high enough to change the world,

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nobility becomes the scarcest resource.

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Think about it —

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have you seen similar scenarios around you?

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Friends starting a business together,

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agreeing at the beginning,

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"Brothers in arms,

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we'll share the wealth."

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Everyone is noble when the company is small.

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But once the company is valuable,

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how is equity split?

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Who should be CEO?

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Whose contribution was greater?

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All the questions that never needed answering

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suddenly become the sharpest ones.

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This trial

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is essentially a partner falling-out magnified ten thousand times.

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The trial will last several more weeks,

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with a series of high-profile witnesses set to appear.

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Altman himself will take the stand.

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He spent the entire first week in the defendant's seat,

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expressionless,

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without saying a word.

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When he finally speaks,

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all of Silicon Valley will hold its breath.

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Microsoft CEO Satya Nadella is also expected to testify,

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as Musk accuses Microsoft of assisting OpenAI

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in completing its transition to a for-profit model.

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Without Microsoft's $13 billion investment,

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none of this would have been possible.

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Nadella must explain to the nine jurors

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whether Microsoft knew when it signed the deal

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that it was helping a non-profit transform.

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There's another particularly noteworthy witness,

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Shivon Zilis.

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She wears three hats:

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former OpenAI board member,

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mother of four of Musk's children,

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and the alleged leaker of internal information.

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OpenAI claims Zilis used her board position

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to leak internal decisions and trade secrets to Musk.

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This character map alone

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is enough for a three-season TV drama.

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But the real question this trial leaves us with is this:

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When an organization founded with a non-profit mission

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creates technology that could change human destiny,

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what should it do?

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Stay non-profit?

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Who then pays the billions in annual training bills?

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A non-profit structure can't sustain that level of cash burn.

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Turn for-profit?

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Then what about the original donors' money?

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What about the researchers who joined for the mission?

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The deeper question is:

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With a for-profit company controlling the most powerful AI,

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who ensures it still serves all of humanity?

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There is no standard answer to this question.

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But the nine jurors must provide one.

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Their answer will not only decide this lawsuit,

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but may also redefine a fundamental rule:

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that is,

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when humanity creates an unprecedentedly powerful technology,

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what institutional framework can ensure its survival

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while ensuring it doesn't only serve the few?

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If you have thoughts on this topic,

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especially on how AI companies should be structured

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to balance mission and survival,

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I’d love to hear your perspective.

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I am Leo Wang.

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See you next time.