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To beat Altman in court, Musk offers to give all damages to OpenAI nonprofit

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Why This Matters

Elon Musk's legal strategy shift emphasizes that any recovered damages from OpenAI should benefit its nonprofit arm, highlighting a focus on charitable missions rather than personal gain. This development underscores ongoing tensions in AI industry leadership and raises questions about accountability and the use of AI-related funds. For consumers and industry stakeholders, it signals increased scrutiny over AI companies' governance and financial practices.

Key Takeaways

On Tuesday, Elon Musk amended his lawsuit that accuses OpenAI and its CEO, Sam Altman, of abandoning its mission, clarifying that any ill-gotten gains recovered should be returned to the AI firm’s charitable nonprofit arm, not to Musk.

Musk “is not seeking a single dollar for himself,” according to his lawyer, Marc Toberoff.

Toberoff told The Wall Street Journal that the new remedies that Musk is seeking strip away distracting claims from OpenAI that the lawsuit is intended to harass and harm the AI firm that Musk helped co-found but today is one of his biggest rivals.

“He is asking the court to return everything that was taken from a public charity—and to make sure the people responsible are never in a position to do this again,” Toberoff told the WSJ. “That was the essence of his complaint from the outset of this case, until OpenAI’s spin doctors got to work distorting it. This filing sets the record straight.”

However, Musk’s pivot comes after US District Judge Yvonne Gonzalez Rogers issued an order that risked severely limiting the remedies Musk could seek in the lawsuit if he didn’t change his strategy.

A week prior to Musk’s filing, the judge denied Musk’s request for punitive damages. She also agreed with defendants that Musk’s expert—who calculated that OpenAI and Microsoft’s wrongful gains from Musk’s early donation of $38 million could near $134 billion—didn’t calculate remedies in a way that supported Musk’s arguments for disgorgement. In other words, Musk failed to argue that he should get to pocket those damages.

Musk’s legal theories fizzled out

It seems clear from Gonzalez Rogers’ order that Musk realized he needed to change his damages claims to keep the lawsuit alive. She also denied his request to instruct the jury about his theory that his damages “accrued every time Defendants used the fruits of Musk’s contributions to pursue purposes other than the charitable purposes for which those contributions were given.”