The state’s attorney general determines that Elon Musk’s legal action does not serve California’s public interest, declining to join the case.
The California Attorney General’s office has opted not to join Elon Musk’s lawsuit against OpenAI, citing that the action does not align with the state’s public interest. This decision was confirmed in a letter made public on Tuesday.
Musk, co-founder of OpenAI, is currently in a legal dispute with Sam Altman, the company’s CEO, over OpenAI’s future direction. At the heart of the lawsuit is Musk’s contention that OpenAI’s proposal to eliminate its nonprofit board, which currently holds control of the company, threatens its foundational mission. Musk has called on California to back his legal action.
However, the state attorney general’s office expressed reservations, stating in the letter, dated Monday, that Musk had not demonstrated how his lawsuit would serve the public good. The letter also implied that Musk might be attempting to use OpenAI’s charitable assets for his own benefit. This follows Musk’s February offer of a $97 billion bid for control of the company, made by a consortium he leads.
Since OpenAI is based in California, the attorney general’s office would need to approve any transition regarding its nonprofit status. A group of philanthropists and organisations, including Meta, has urged the attorney general to prevent OpenAI from making the proposed shift.
In response, OpenAI argues that removing its nonprofit governance structure is essential for attracting investment, which would enable the company to secure a $40 billion fundraising round. To meet its fundraising goals, the company must complete this transition by the year’s end. OpenAI maintains that the nonprofit will retain a significant stake in the company, and this stake will grow in value, helping to support its mission.
Musk and Altman founded OpenAI in 2015, though Musk departed before the company became a major player in technology. Last year, Musk filed a lawsuit against both OpenAI and Altman, accusing the company of abandoning its original mission of creating AI for the benefit of humanity rather than corporate profit. OpenAI and Altman have denied these allegations, and the legal dispute is set to go to trial next spring.
In addition to his legal battle with OpenAI, Musk established his own AI firm, xAI, in 2023. Altman has accused Musk of trying to hinder the growth of this competitor.
