Musk Testifies OpenAI 'Stole a Charity' in $38M Funding Lawsuit

Tech billionaire Elon Musk has charged that OpenAI CEO Sam Altman "stole a charity" and called himself a "fool" for funding the company, claiming that the ChatGPT maker had strayed from its original nonprofit mission. Musk sued OpenAI in 2024, alleging he was misled when he co-founded and funded the company in 2015 on the understanding it would remain a nonprofit. The AI firm, now valued at about $85 billion, has since restructured, with a nonprofit parent retaining a stake in its for-profit arm, including ChatGPT.

Testifying on Wednesday, Musk said OpenAI and its chief executive, Sam Altman, had broken that founding commitment by shifting toward a profit-driven model, according to court proceedings. He said he continued financing OpenAI after receiving assurances from Altman that it would remain a nonprofit. "I was a fool who provided them free funding to create a startup," Musk told a federal court in Oakland. The Tesla and SpaceX CEO said he contributed $38 million from December 2015 through May 2017, believing he was supporting a charitable venture.

Musk's lawsuit alleges OpenAI abandoned its founding agreement by pivoting to a for-profit model and seeks to remove Altman and Brockman, reverse the shift and secure damages for the nonprofit arm. He described his view of OpenAI's leadership in three phases, moving from "enthusiastic support" to a loss of confidence and finally to a belief that "they're looting a nonprofit." "They can't have it both ways," Musk said of OpenAI. "They can't have a nonprofit and free funding and the positive halo effect of being a nonprofit charity and also enrich themselves greatly."

Under cross-examination, Musk clashed with OpenAI lawyer William Savitt. When pressed for simple answers on emails discussing a for-profit structure, Musk pushed back. "Your questions are not simple," Musk said. "They are designed to trick me essentially."

OpenAI has rejected the allegations, arguing that leaders never promised the organization would remain a nonprofit forever. The company contends Musk's legal challenge aims to undercut OpenAI's rapid growth and bolster his rival AI startup, xAI. Musk left OpenAI in 2018 due to disagreements with Altman, bought Twitter (now X) in 2022, and launched his own artificial intelligence firm xAI the following year. The trial in California started on Monday and is expected to last about four weeks.