Musk Seeks As much as $134 Billion Damages From OpenAI, Microsoft

Elon Musk needs OpenAI Inc. and Microsoft to pay him damages within the vary of $79 billion to $134 billion over his claims that the generative AI firm defrauded him by abandoning its nonprofit roots and partnering with the software program large.

Musk’s lawyer detailed the damages request in a court docket submitting Friday, a day after a federal choose rejected a ultimate bid by OpenAI and Microsoft to keep away from a jury trial set for late April in Oakland, California.

Citing calculations by a monetary economist professional witness, C. Paul Wazzan, the submitting says Musk is entitled to a piece of OpenAI’s present $500 billion valuation after he was defrauded of the $38 million in seed cash he donated to OpenAI when he helped discovered the startup in 2015. OpenAI and Microsoft later disputed the calculations.

“Simply as an early investor in a startup firm might understand features many orders of magnitude better than the investor’s preliminary funding, the wrongful features that OpenAI and Microsoft have earned – and which Mr. Musk is now entitled to disgorge – are a lot bigger than Mr. Musk’s preliminary contributions,” Musk lawyer Steven Molo wrote.

Musk left OpenAI’s board in 2018, launched his personal synthetic intelligence firm in 2023 and started a court docket battle in 2024 with Sam Altman over the OpenAI co-founder and chief government officer’s plans to function the corporate as a for-profit enterprise. OpenAI and Microsoft have denied his allegations.

“Mr Musk’s lawsuit continues to be baseless and part of his ongoing sample of harassment, and we look ahead to demonstrating this at trial,” OpenAI mentioned in an announcement. “This newest unserious demand is aimed solely at furthering this harassment marketing campaign.”

Altman has denounced Musk’s lawsuit difficult OpenAI’s restructuring as a weaponization of the authorized system to decelerate a competitor. OpenAI has warned buyers to count on Musk to make attention-grabbing claims because the authorized battle heads to trial.

OpenAI, the maker of ChatGPT, introduced its restructuring in October. It mentioned on the time that it had given a 27% possession stake to its longtime backer Microsoft in a transition that may preserve the startup’s nonprofit arm accountable for its for-profit operations.

Wazzan, the professional witness, calculated the damages request by combining Musk’s monetary and non-monetary contributions, together with technical and enterprise recommendation, to OpenAI, in keeping with the submitting. He figured that the wrongful features whole $65.50 billion to $109.43 billion for OpenAI and $13.30 billion to $25.06 billion for Microsoft.

Musk’s submitting says he additionally plans to hunt punitive damages and presumably an injunction that the submitting didn’t describe.

In a response filed in court docket early Saturday, OpenAI and Microsoft attacked Wazzan’s conclusions and requested that he not be allowed to repeat them at trial. Attorneys for the businesses mentioned Musk is looking for as a lot as 2,900 instances what he invested within the startup.

“Wazzan’s methodology is made up; his outcomes unverifiable; his strategy admittedly unprecedented; and his proposed end result — the switch of billions of {dollars} from a nonprofit company to a donor-turned competitor — implausible on its face,” attorneys for the businesses wrote.

With help from Shirin Ghaffary and Brody Ford.

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