Musk Sues OpenAI, Microsoft for $134 Billion, Claiming ‘Betrayal’

San Francisco – It is the divorce of the century in Silicon Valley. Elon Musk, the world’s richest man, has launched a blistering legal attack against OpenAI (the creator of ChatGPT) and its biggest backer, Microsoft.

In a lawsuit filed late yesterday, Musk demands a staggering $134 billion in damages. His claim? That he was “fraudulently induced” to fund OpenAI as a non-profit designed to save humanity, only to watch it transform into a for-profit cash machine for Microsoft.

Table of Contents

• The Claim: “I Paid for Safety, They Sold It”
• The Origin Story: Saving Humanity from Google
• The Pivot: From Non-Profit to $100B Empire
• What Happens If Musk Wins?
• Key Takeaways
• Dutch Learning Corner
• Community CTA

The Claim: “I Paid for Safety, They Sold It”

The lawsuit, filed in Delaware, reads like a corporate thriller.

Musk alleges that OpenAI has violated its founding contract. He argues that his early investments (tens of millions of dollars) were given on the explicit condition that OpenAI would remain:
1. Open Source: Sharing its code with the world.
2. Non-Profit: Prioritizing human safety over shareholder value.

Instead, Musk claims OpenAI has become a “closed-source de facto subsidiary” of Microsoft, refining Artificial General Intelligence (AGI) to maximize profits for the tech giant rather than for the benefit of humanity.

The Origin Story: Saving Humanity from Google

To understand the anger, you have to go back to 2015.

Musk, along with Sam Altman and others, founded OpenAI as a counterweight to Google’s dominance in AI. They feared that if a giant corporation controlled AGI, it could pose an existential risk to humanity.

“The goal was simple,” Musk’s lawyers state. “To create a safe AI that belongs to everyone.”

Musk left the board in 2018 due to conflicts with Tesla’s AI work, but he continued to believe in the mission—until ChatGPT launched and the Microsoft partnership deepened.

The Pivot: From Non-Profit to $100B Empire

The core of the dispute is OpenAI’s unique (and confusing) structure.

Technically, OpenAI is still a non-profit. However, it created a “capped-profit” arm to accept billions in investment from Microsoft. Musk argues this was a legal trick to funnel value to Microsoft while using the non-profit status as a shield.

The Money:
Musk is seeking $79 billion in damages, plus interest, totaling roughly $134 billion. This figure represents the immense value created by OpenAI—value that Musk claims rightfully belongs to the public (or early backers), not just Microsoft.

What Happens If Musk Wins?

Legal experts face a tough case. “Proving ‘fraudulent inducement’ is incredibly hard,” notes a corporate law specialist. “Musk has to prove they planned to betray him from day one.”

However, if the court sides with Musk, the consequences could be earth-shattering:

• Open Source Order: The court could force OpenAI to release its secret code (GPT-4/5) to the public.
• Microsoft Block: It could bar Microsoft from using OpenAI’s latest tech for commercial gain.
• Repayment: It could bankrupt the organization with massive fines.

Key Takeaways

• The Amount: Musk wants $134 billion for “breach of contract.”
• The Accusation: OpenAI abandoned its non-profit mission to serve Microsoft.
• The Stakes: The future of AI ownership—public good vs. corporate profit.
• The Irony: Musk is now building his own rival AI, xAI (Grok).

Dutch Learning Corner

Source / Tech: Court Filings (Delaware) & TechCrunch.