OAKLAND, Calif. (AP) - Elon Musk's took on with OpenAI in court Tuesday as a federal judge weighed the billionaire's ask for a court order that would obstruct the ChatGPT maker from converting itself to a for-profit business.
U.S. District Judge Yvonne Gonzalez Rogers said it was a "stretch" for Musk to claim he will be irreparably hurt if she doesn't step in to stop OpenAI from moving on with its transition from a not-for-profit lab to a for-profit corporation.
But the judge likewise raised concerns about OpenAI and its relationship with service partner Microsoft and said she wouldn't stop the case from moving to trial as quickly as next year so a jury can choose.
"It is plausible that what Mr. Musk is saying is true. We ´ ll learn. He ´ ll rest on the stand," she said.
Musk, an early OpenAI financier and board member, took legal action against the expert system business in 2015, first in a California state court and later on in federal court, alleging it had betrayed its starting aims as a not-for-profit research study lab benefiting the public excellent. Musk had invested about $45 million in the startup from its founding until 2018, his attorney said Tuesday.
Musk escalated the legal conflict late last year, adding new claims and accuseds and asking for a court order that would stop OpenAI ´ s prepares to transform itself into a for-profit organization more fully. Musk also included his own AI company, xAI, as a plaintiff.
Also targeted by Musk's claim is OpenAI's close company partner Microsoft and tech entrepreneur Reid Hoffman, a former OpenAI board member who also rests on Microsoft's board.
Gonzalez Rogers said she has a high bar for approving the sort of preliminary injunction that Musk desires however hasn't yet ruled on the request. She did say she had "considerable issues" with two people linked to Microsoft on OpenAI's board - Hoffman and long time Microsoft executive Deanna Templeton, who was a "non-voting observer."
"So you desire me to think that she was sitting there listening to all the discussions and not informing anybody? What would the point be for her to sit there and listen to everybody, if not to interact what she was listening? There would be no point for her to be there, which is why she actually ought to not exist," she said.
Hoffman, a co-founder of LinkedIn, has been on Microsoft ´ s board considering that quickly after the tech giant purchased the job networking website. He stepped down from OpenAI's board in 2023 to avoid conflicts with his AI start-up, Inflection.
Templeton, who Musk also called as a defendant, was added as a non-voting member of OpenAI ´ s board in the aftermath of Altman ´ s ouster after Microsoft CEO Satya Nadella sought more stability on the board. But months later, she was dropped from the OpenAI board as U.S. antitrust enforcers were revealing concerns about such plans on corporate boards.
The judge has actually handled a number of tech industry cases including Apple's battle with Epic Games, though she said Tuesday that Musk's case is "absolutely nothing like" that a person. That case was also the last time she granted an initial injunction, in 2020, eight months before the case went to trial.
Then-President Barack Obama selected Gonzalez Rogers to the federal bench in 2011.
Tuesday's hearing was initially set for January however was held off after Musk's attorney Marc Toberoff said his home was damaged in the Pacific Palisades wildfire.
Musk, who did not go to the hearing, has actually alleged in the claim that the companies are breaching the terms of his fundamental contributions to the charity. Judge Gonzalez Rogers called it a "stretch" to claim "irreversible damage" to Musk, and called the case "billionaires vs. billionaires." She questioned why Musk invested 10s of millions in OpenAI without a composed contract. Toberoff said it was due to the fact that the relationship between Altman and Musk at the time was "constructed on trust" and the 2 were very close.
"That is simply a great deal of cash" to invest "on a handshake," the judge said.
OpenAI has said Musk ´ s requested court order would "debilitate OpenAI ´ s organization"and objective to the advantage of Musk and his own AI company and is based on "far-fetched" legal claims.
At the heart of the disagreement is a 2017 internal power battle at the recently established startup that led to Altman becoming OpenAI ´ s CEO
. Emails revealed by OpenAI reveal Musk had also sought to be CEO and grew frustrated after 2 other OpenAI co-founders said he would hold too much power as a major investor and chief executive if the startup prospered in its objective to attain better-than-human AI referred to as synthetic general intelligence, bytes-the-dust.com or AGI. Musk has long voiced issues about how advanced kinds of AI might threaten humanity.
Altman eventually prospered in becoming CEO and has actually remained so except for a duration in 2023 when he was fired and after that renewed days later after the board that ousted him was replaced.
OpenAI has actually looked for to demonstrate Musk ´ s early assistance for the idea of making OpenAI a for-profit organization so it could raise cash for the hardware and computer power that AI requires.
Musk is not the only one tough OpenAI's for-profit transition. Facebook and Instagram moms and online-learning-initiative.org dad Meta Platforms has asked California's attorney general to obstruct it, and the workplace of Delaware's lawyer general has said it is reviewing the conversion.
It was not clear Tuesday when the case may go to trial. Musk's lawyers initially said they would be ready by June after some back-and-forth with the 2 sides the judge showed it probably will not be until June 2026 at the earliest, but likely early 2027.
O'Brien reported from Providence, Rhode Island.
-------