Elon Musk vs OpenAI: What lies at the heart of the court battle now?

In 2024, Elon Musk sued OpenAI, arguing that the company had breached its principles when it was founded in 2015

Elon Musk and Sam Altman’s long-running feud returned to a federal court in California this week. The dispute, which has played out for years both inside Silicon Valley and on social media, centres on Musk’s allegation that OpenAI misled him by shifting away from its non-profit roots towards a for-profit structure. 

Once a shared vision, now a billion-dollar feud

Elon Musk and Altman joined hands in 2015 to build OpenAI, a new kind of technology lab. The organisation, created to focus on artificial intelligence (AI), was a non-profit venture with the mission to ensure that the technology benefits all of humanity.  According to court documents, OpenAI’s mission was to “shift the dialogue toward being about humanity winning rather than any particular group or company,” the New York Times quoted.  Altman pitched the idea of OpenAI to Musk, whom he called his “hero,” in 2012. While Altman was the face of the non-profit, Musk gave initial funding.  Musk, in a joint conference with Altman in 2015, said that AI was the one technology that "could most change humanity.” But he was sceptical, as he added AI was "really dodgy" and "fraught with difficulty".  Things later got complicated, with Musk alleging that OpenAI had unlawfully moved away from its non-profit mission. However, OpenAI’s formal shift to a for-profit structure took place only in October 2025.  OpenAI leaders and Musk, in 2017, mutually agreed that it was a logical next step to advance the AI mission, and the company abandoned its non-profit model, the defendants stated in court. They also added that Musk wanted total control of OpenAI and to be CEO, an advance the company rejected.  By 2018, Musk stated that OpenAI had no path forward with its current structure and declared it was on “a path of certain failure”, in emails to Ilya Sutskever and Greg Brockman. His proposed solution was to merge Tesla and OpenAI. “In my and Andrej’s opinion, Tesla is the only path that could even hope to hold a candle to Google,” Musk said. The plan never materialised, and Musk resigned from OpenAI’s board that year.  In an email to OpenAI employees a few months before his exit wrote, “Guys, I've had enough,” BBC quoted.  “Either go do something on your own or continue with OpenAI as a nonprofit… I will no longer fund OpenAI until you have made a firm commitment to stay or I'm just being a fool who is essentially providing free funding for you to create a startup.”  

Why is Elon Musk battling against OpenAI?

With Musk’s exit, the feud seemed to have calmed down. However, four years later, OpenAI launched ChatGPT for public use, a move that essentially changed the face of AI, with 100 million active users within months.  In 2024, Musk sued OpenAI, arguing that the company had breached its principles when it was founded. His main claim: ChatGPT departed from its original open-source missions.  The lawsuit, which has also been filed against Altman and co-founder Greg Brockman, stated that instead of trying to “benefit humanity,” it is focusing on "maximising profits" for major investor Microsoft.  Through a series of investments, Microsoft has invested billions of dollars in OpenAI. As of now, Microsoft owns a 27 per cent stake in the company.  Since the lawsuit, the feud between the two tech titans has only grown more bitter. Last year, Musk, with a consortium of investors, offered to buy OpenAI’s assets for $97.4 billion. As of March 31, 2026, OpenAI is valued at $852 billion and is mulling a public listing.  Musk has tried to buy OpenAI several times now, with one report stating that he also approached Meta CEO Mark Zuckerberg to join him in bidding on the OpenAI IP.