•  Musk has expanded his lawsuit against OpenAI, a company he co-founded, to include Microsoft and other defendants.
• The lawsuit alleges that OpenAI is becoming a fully for-profit subsidiary of Microsoft and is trying to eliminate competitors.
• OpenAI is accused of lying to donors, members, markets, regulators, and the public.
• The lawsuit raises questions about the ethics of AI development, the business practices of tech companies, and the future of AI regulation.

Elon Musk, the US government efficiency czar, has broadened his legal battle against OpenAI, a company he co-founded and is now run by Sam Altman. Initially, the lawsuit targeted OpenAI for deviating from its non-profit stance. However, it now includes new defendants such as Microsoft, LinkedIn co-founder Reid Hoffman, and former OpenAI board member and senior Microsoft executive, Dee Templeton.

The lawsuit was lodged in a district court in California and has also named new plaintiffs. These include Neuralink executive and ex-OpenAI board member Shivon Zilis and Musk's AI company, xAI. The lawsuit alleges that OpenAI, initially co-founded by Musk as an independent charity committed to safety and transparency, is rapidly becoming a fully for-profit subsidiary of Microsoft under the direction of Altman, Brockman, and Microsoft.

Musk's legal team has contended that OpenAI is actively trying to eliminate competitors such as xAI by extracting promises from investors not to fund them. The lawsuit further alleges that OpenAI has transitioned from a tax-exempt charity to a $157 billion for-profit entity in just eight years, a move that the lawsuit claims violates almost every principle of law governing economic activity.

OpenAI Accused of Deception and Unfair Practices

The lawsuit accuses OpenAI of lying to donors, members, markets, regulators, and the public. It also highlights the standing of Zilis, who stepped down from OpenAI's board in 2023, as an "injured employee" under California Corporations Code. Zilis, who has close ties to Musk, having worked as a project director at Tesla from 2017 to 2019 and also directed Neuralink research, is now a plaintiff in the lawsuit.

The lawsuit further alleges that the efforts by Altman and his cohorts to cash in and squeeze others out have their roots in OpenAI's partnership with Microsoft. The lawsuit claims that together, they established an opaque web of for-profit OpenAI affiliates, the only value of which came from looting OpenAI, Inc. of the intellectual property, employees, and relationships developed by exploiting Musk's name and contributions, the charity's tax status, and the goodwill generated by its supposed philanthropic commitment.

Musk's Concerns Over AI Ethics and Business Practices

While Musk had expressed an affinity for Microsoft's CEO Satya Nadella, the lawsuit states that the values of Microsoft and OpenAI did not align. Musk, who believes that AI poses an existential danger to humankind and should be decentralized and open, was dismissed by Nadella and Microsoft's co-founder Bill Gates as being in a state of 'panic' and too far off in the future. Microsoft has yet to comment on the amended lawsuit.

This lawsuit brings to mind the historical antitrust cases against Microsoft in the late 1990s and early 2000s. The US government had accused Microsoft of monopolistic business practices and anti-competitive strategies. The current lawsuit against OpenAI and Microsoft seems to echo similar concerns, with allegations of OpenAI becoming a fully for-profit subsidiary of Microsoft and attempts to eliminate competitors in the AI field.