Elon Musk is asking for up to $134 billion in damages from OpenAI and Microsoft in a lawsuit that claims the AI company tricked him by dropping its nonprofit mission. The case, filed in federal court in Oakland, California, moves forward to a jury trial starting April 27 after a judge rejected efforts to dismiss it. Musk, who gave OpenAI $38 million in seed money back in 2015, says leaders like Sam Altman and Greg Brockman misled him about keeping the company open and nonprofit-focused. Now valued at around $500 billion, OpenAI shifted to a for-profit model, which Musk calls a betrayal.
Background
OpenAI started in 2015 as a nonprofit group aimed at building artificial intelligence that would help all of humanity. Tech leaders worried big companies like Google and Facebook would control AI without sharing benefits. Musk helped found it and donated $38 million through an intermediary. He pushed for open-source work and no profit motive, matching the group's charter.
By 2017, things changed. OpenAI needed more money to compete. Talks turned to adding a for-profit arm. Musk wanted a bigger role, even suggesting a merger with Tesla. When that fell apart, he left the board. OpenAI went ahead with changes, partnering closely with Microsoft, which poured in billions. In 2025, it fully became a for-profit public benefit corporation.
Musk sued in February 2024, saying OpenAI broke its promises. Court fights dragged on. OpenAI and Microsoft tried to get the case thrown out multiple times. On January 15, 2026, U.S. District Judge Yvonne Gonzalez Rogers said no. She pointed to evidence like internal emails and notes showing possible misstatements to Musk.
One key piece came from discovery: private writings by Greg Brockman, OpenAI's president. In November 2017, just months after reassuring Musk about the nonprofit setup, Brockman noted his doubts.
"I cannot believe that we committed to non-profit if three months later we're doing b-corp then it was a lie."
That line, from Brockman's personal journal, became central to Musk's fraud claims. The judge said it raised questions about what leaders told early backers.
Key Details
Musk's team brought in C. Paul Wazzan, a financial expert who values companies in big disputes. Wazzan calculated damages based on Musk's early contributions: cash, ideas, and guidance to the team. He figures OpenAI gained $65.5 billion to $109.4 billion wrongfully, and Microsoft $13.3 billion to $25.1 billion. That totals $79 billion on the low end, up to $134 billion. It's a return thousands of times Musk's original $38 million.
The judge kept alive claims of breach of contract and fraud. She noted Musk tied his support to two things: open-source AI and nonprofit status. OpenAI's charter backed that at first. Rejecting dismissal, she wrote that letting donors use intermediaries off the hook would hurt charity enforcement overall.
Unsealed Documents
Over 100 files came out last week, including Brockman's diary and texts from Microsoft CEO Satya Nadella. One email from board member Shivon Zilis told Musk in 2017 that Brockman wanted to stick with nonprofit. But Brockman's later note showed second thoughts. OpenAI's blog called Musk's use of these 'cherry-picked.' They say Musk knew about for-profit plans and quit when he couldn't take over.
Musk's lawyer Marc Toberoff said the ruling shows 'substantial evidence' of false promises for personal gain. OpenAI called the suit baseless harassment and looks forward to trial. They note their foundation remains well-funded as a nonprofit.
The trial will cover if OpenAI's shift was fraud. A jury in Northern California will hear from Musk, Altman, Brockman, and others. Location is Oakland, near San Francisco's tech hub.
What This Means
This case could reshape how AI companies handle their missions. Nonprofits turning for-profit face more scrutiny from donors. Musk's push highlights tensions between open AI and business gains. OpenAI's $500 billion value is at stake, though damages might not take it all.
For Musk, with a fortune over $700 billion from Tesla and SpaceX, the money is small. His xAI competes directly with OpenAI. A win could give him use or even a stake. Loss might end his claims but boost OpenAI's model.
AI race heats up. Microsoft invested billions in OpenAI. Others like Google watch closely. Trial in spring 2026 comes as AI tools like ChatGPT change daily life and work.
Broader effects hit charity rules. Judges protect donor intent in trusts. This ruling sets precedent. Tech founders journaling or texting privately now think twice with lawsuits looming.
OpenAI keeps building amid the fight. They say focus stays on safe AI for good. Musk warns of risks without openness. Jury decides who broke faith first.
Both sides gear up. More documents may surface. Public sees inside early AI days: big dreams, cash needs, clashing egos. April trial brings it to courtroom.
