San Francisco Frontiers - Jury selection starts in Elon Musk's legal battle with OpenAI

The legal clash in a courtroom across the bay from San Francisco pits the world's richest person against a startup Musk once backed and now competes with in the booming AI sector.

OpenAI's ChatGPT is a formidable rival to the chatbot Grok, made by Musk's xAI lab.

"This is a tech soap opera that all investors will be watching," Wedbush analyst Dan Ives said in a note to investors.

"There will be a lot of dirt and slings thrown around in court between Musk and Altman and that is not a good thing for anyone involved...but Musk has made this personal."

While Musk's lawsuit is part of a feud between him and OpenAI Chief Executive Sam Altman, it spotlights a debate as to whether AI should ultimately serve to benefit a privileged few or society as a whole.

Court filings lay out how Altman convinced Musk to back OpenAI in 2015, acting as a co-founder for a non-profit lab whose technology "would belong to the world."

Musk pumped millions of dollars into the lab, which he subsequently left.

However, OpenAI established a commercial subsidiary, as it needed hundreds of billions of dollars for data centers to power its technology.

Microsoft has poured billions of dollars into OpenAI and its CEO Satya Nadella is among those slated to testify at the trial.

- Benevolence or power? -

Musk argues in his lawsuit that he was deceived about OpenAI's mission being altruistic.

San Francisco-based OpenAI has countered in court filings that its break-up with Musk was due to his quest for absolute control rather than its nonprofit status.

"This case has always been about Elon generating more power and more money for what he wants," OpenAI said in a recent X post. "His lawsuit remains nothing more than a harassment campaign that's driven by ego, jealousy and a desire to slow down a competitor."

The startup noted that days after Musk entered the AI race in 2023 he called for a six-month moratorium on development of advanced AI.

The judge presiding over the trial will decide by mid-May -- guided by an advisory jury's findings -- whether OpenAI broke a promise to Musk in a drive to lead in AI, or just smartly rode the technology to glory.

Along with calling for OpenAI to be forced to revert to a pure nonprofit, Musk's suit urges the ouster of Altman and co-founder Greg Brockman, who is the startup's president.

Musk, who had sought as much as $134 billion in damages, has since renounced any personal benefit, pledging to redirect any award to the OpenAI nonprofit. Judge Yvonne Gonzalez Rogers has reserved the right to determine any remedies herself, without the jury's input.

OpenAI now has a hybrid governance structure giving its nonprofit foundation control over a for-profit arm.

Musk, who gutted the trust and safety team at Twitter after buying the social media platform that he renamed X, faces the challenge of convincing a jury and a judge that the company behind ChatGPT was built on a lie.

E.Walker--SFF