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Elon Musk sues OpenAI and CEO Sam Altman over breach of contract

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Elon Musk is taking legal action against OpenAI, CEO Sam Altman, and others for allegedly breaking the contractual agreements that were made when the company was established in 2015. Musk played a role in founding the company in 2015.

The lawsuit, brought by the CEO of Tesla, also involves OpenAI’s co-founder Greg Brockman. The legal claim argues that Brockman and Altman, initially approached Musk with the idea of creating an open-source, nonprofit organization focused on advancing artificial intelligence technology for the betterment of humanity. Musk co-founded OpenAI in 2015 but stepped down from the board in 2018.

The lawsuit asserts that OpenAI’s shift towards profit-making objectives contradicts the original agreement. Musk saw this change as a significant risk to advanced general intelligence (AGI).

Musk’s lawyers mentioned that Altman proposed to Musk the formation of a nonprofit AI lab to compete with Google in AGI research but with a different approach. Brockman and Musk agreed on the core principles of the new AI lab, emphasizing that OpenAI would be nonprofit, focused on developing AGI for the benefit of humanity, and would operate in an open-source manner except for safety considerations.

The organization was intended to offer an alternative to Google’s DeepMind project, prioritizing the advancement of humanity over profit-driven motives commonly seen in private companies.

Elon Musk’s competition with OpenAI

In January, Elon Musk’s artificial intelligence startup xAI was reportedly seeking to raise up to $6 billion. xAI gained attention in 2024 for introducing “Grok,” a chatbot positioned as a competitor to OpenAI’s ChatGPT.

Another company named Groq had trademarked its name in 2016 and sent a cease-and-desist letter to Musk regarding his company’s similar name, xAI.

Featured image: Canva / U.S. Air Force / Trevor Cokley / TechCrunch

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