Elon Musk donated millions to OpenAI at its founding in 2015. On April 27th, 2026, jury selection began in his lawsuit against the company he helped create.
Musk's core argument, filed in 2024, is that OpenAI abandoned its founding purpose - developing artificial general intelligence (AI capable of performing most tasks a human can do) for public benefit through a nonprofit structure - when it created a for-profit subsidiary and accepted $13 billion from Microsoft. He argues this was a breach of contract, and that his original donations were made on the understanding that OpenAI would operate as a public benefit organization, not a commercial one.
What Each Side Is Fighting For
Musk's lawsuit asks the court to block OpenAI's conversion from a nonprofit to a for-profit public benefit corporation - a structural change OpenAI announced to give it more flexibility to raise capital. He also wants OpenAI's technology made freely available to the public, in line with what he claims was the founding mission.
OpenAI's defense will center partly on Musk's conflict of interest: he now runs xAI, which makes the Grok AI model and competes directly with ChatGPT. The company has argued the lawsuit is a competitive play dressed up as a principled stand. Musk's lawyers say his motivations are irrelevant to whether OpenAI broke its founding commitments.
The Stakes Beyond the Verdict
A ruling against OpenAI could block or complicate its for-profit conversion - and that conversion is central to the company's capital-raising strategy. The current hybrid structure, where a nonprofit controls a capped-profit subsidiary, limits how much investors can earn and constrains fundraising at the scale OpenAI wants.
The trial also puts internal documents into the public record. Deposition material already released includes communications between Musk, Altman, and early OpenAI figures about governance and organizational purpose. Whatever the verdict, that record shapes how the industry discusses accountability and corporate structure going forward.
OpenAI reportedly needs to finalize its conversion before a ruling creates legal uncertainty - the deadline tied to existing investor agreements is reportedly end of 2026. The trial timing creates real pressure on that schedule.