Musk's Claim against OpenAI May go to Trial In Part, Judge Says
Musk takes legal action against to block OpenAI's conversion to a for-profit structure
Musk cofounded OpenAI with Altman in 2015
OpenAI argues for-profit relocation required for capital
Nonprofit to for-profit conversion unusual, specialist states
(Adds judge did not decide whether to provide the injunction in paragraph 5, OpenAi's attorneys' comment in paragraph 13)
By Anna Tong and Akash Sriram
OAKLAND, Calif., Feb 4 (Reuters) - A federal judge said on Tuesday that parts of Elon Musk's claim against OpenAI to stop its conversion to a for-profit entity may go to trial, adding that the Tesla CEO will need to appear in court and testify.
"Something is going to trial in this case," U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California, wiki.philipphudek.de said early in the court session.
"(Elon Musk will) sit on the stand, present it to a jury, and a jury will decide who is right." Rogers was considering Musk's current ask for an initial injunction to obstruct OpenAI's conversion before going to trial, the current move in a grudge match between the world's richest person and OpenAI CEO Sam Altman that is playing out openly in court.
Rogers did not decide whether to issue the injunction Tuesday, however at one point suggested that Musk's legal group had not presented enough evidence for her to issue the injunction, and showed she may hold an evidentiary hearing, where both sides might provide witnesses and evidence. The last time Rogers offered a preliminary injunction remained in Epic Games' case against Apple in May 2021.
Musk cofounded OpenAI with Altman in 2015, however left before the company took off and subsequently established the competing AI startup xAI in 2023. OpenAI is now trying to transition from a nonprofit into a for-profit entity, which it says it requires to do to protect the capital required to establish the finest synthetic intelligence models. Last year, Musk filed a claim against OpenAI and Altman, forum.altaycoins.com saying that OpenAI ´ s founders initially approached him to money a not-for-profit concentrated on developing AI to benefit mankind, users.atw.hu but that it is now concentrated on making cash. He later broadened the claim to add federal antitrust and other claims, allmy.bio and in December asked the judge administering over the case to stop OpenAI from transitioning to a for-profit.
In reaction to Musk ´ s claim, OpenAI has said it will transfer to ´ s claims and that Musk "must be competing in the marketplace rather than the courtroom." The stakes on OpenAI's business shift have now escalated, akropolistravel.com as OpenAI ´ s last fundraising round of $6.6 billion and a brand-new round of up to $25 billion under discussion with SoftBank are conditioned on the business restructuring to eliminate the not-for-profit ´ s control.
During the hearing, OpenAI's legal representatives said the reason to allow OpenAI to become a for-profit entity is due to the fact that it would be essential to facilitate the objective of the not-for-profit.
Such a restructuring would be highly unusual, said Rose Chan Loui, executive director of the UCLA Law Center for Philanthropy and Nonprofits. Nonprofit conversions to for-profits have traditionally been for health care organizations like medical facilities, not venture capital-backed business, she said. (Reporting by Anna Tong in Oakland and Akash Sriram in Bengaluru, gratisafhalen.be Editing by Marguerita Choy)