OpenAI Unravels Some Secrets to Counter Elon Musk’s Lawsuit; Who’s in the Wrong?

OpenAI Counters Elon Musk's lawsuit allegations
In Short
  • Elon Musk filed a lawsuit against OpenAI last week, which claimed the company had turned into a for-profit organization for Microsoft's benefit.
  • Now, OpenAI has shared a blog post to dismiss these allegations by unveiling sensitive emails between Musk and the company.
  • Musk wanted complete control of OpenAI and had also suggested the company announce a $1 billion dollar commitment from him.

Last week, Elon Musk sued OpenAI on breach of contract and fiduciary duty grounds. As per this lawsuit, Musk thinks that OpenAI’s vision is being manipulated by Microsoft. In addition, Musk’s lawsuit also revealed how the original OpenAI vision of developing AGI for, well, “the benefit of humanity” has now been corrupted due to its for-profit-driven goals. OpenAI has fired back today, taking the wraps off some very critically sensitive information to dismiss Musk’s allegations.

OpenAI shared a blog post that includes a trove of emails between the company and Elon Musk. These emails suggest that Musk either wanted OpenAI to “merge with Tesla,” or he wanted “full control” of the company. To be specific, the blog said:

In late 2017, we and Elon decided the next step for the mission was to create a for-profit entity. Elon wanted majority equity, initial board control, and to be CEO. In the middle of these discussions, he withheld funding. Reid Hoffman bridged the gap to cover salaries and operations.

Furthermore, OpenAI added that they couldn’t come to an agreement with Musk for it felt like giving him complete control clashed with the company’s mission and vision.

The blog post also shows Elon Musk stating that he needed OpenAI to go for a “bigger number” than what the CEO Sam Altman and co-founder Greg Brockman had originally planned. Initially, this very number was set at $100 million, but Musk wanted OpenAI to say that we are starting with a $1B funding commitment.”

However, the post specifies in the very beginning that the company has raised less than $45 million from Musk and over $90 million from “other donors.” In other words, the $1 billion funding commitment was a failure, and ultimately, little to nothing came out of it. According to Musk, OpenAI’s nature was gradually and alarmingly transforming from being an open-source platform to a “closed-source de facto subsidiary of the largest technology company in the world: Microsoft.”

OpenAI dismisses this by sharing an email between Ilya Sutskever (co-founder and former chief Scientist at OpenAI) and Musk, where Ilya specifically stated,

As we get closer to building AI, it will make sense to start being less open. The Open in openAI means that everyone should benefit from the fruits of AI after its built, but it’s totally OK to not share the science (even though sharing everything is definitely the right strategy in the short and possibly medium term for recruitment purposes).

After unveiling it all, OpenAI did state that they are sad it had to come to this with, “someone whom we’ve deeply admired—someone who inspired us to aim higher, then told us we would fail, started a competitor, and then sued us when we started making meaningful progress towards OpenAI’s mission without him.”

So, OpenAI vs Elon Musk: Who’s in the Wrong?

The biggest issue with the entire lawsuit is that there is actually no concrete contract of any sort to go by. This entire fiasco is based on just a couple of digital exchanges and oral agreements between OpenAI and Elon Musk. So, while it does make both companies the talk of the town, there’s little to no legal grounds to explore with it.

Even former U.S. Attorney Kevin O’Brien told CNBC, “It’s certainly a good advertisement for the benefit of Elon Musk,” and that he’s not sure how strong the legal foundation of it all is.

There’s no “winner” here if that’s what you are wondering. Instead, it’s just a matter of competitive rivalry, from the looks of it. With Musk’s xAI wing releasing its Grok AI bot to rival ChatGPT, which is undoubtedly OpenAI’s hottest project, I’m not sure if this very lawsuit will give Musk the leverage he’s looking to find.

Moreover, with multiple people such as popular AI expert Gary Marcus taking to X to reveal how OpenAI’s very vision has taken a hit, has the company been honest to itself in the first place? This onion has just started peeling, and there’s a lot more to it than meets the eye.

What do you think about this entire situation? What’s actually at play here? Let us know in the comments down below!

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