Elon Musk Sues OpenAI And CEO Sam Altman For Breach Of Contract

In the suit filed Thursday in San Francisco Superior Court, Elon Musk, who is an OpenAI co-founder and original board member, claims that the artificial intelligence company's recent relationship with tech giant Microsoft has betrayed an agreement from its founding to develop the technology for the benefit of humanity rather than profit. The foundation was originally founded as a non-profit open source AI development project.

"OpenAI, Inc. has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft. Under its new board, it is not just developing but is actually refining an AGI to maximize profits for Microsoft, rather than for the benefit of humanity," Musk says in the suit.

Musk is also concerned about OpenAI's artificial general intelligence(AGI), a type of AI developed to autonomously perform on the cognitive level of humans. The company released GPT-4 in March 2023, but according to Musk, it remains a closed model, in contrast to previous iterations -- a move driven by commercial considerations rather than in the interest of humanity.

"The internal details of GPT-4 are known only to OpenAI and, on information and belief, to Microsoft. GPT-4 is hence the opposite of 'open AI,'" Musk says in the suit. "And it is closed for propriety commercial reasons: Microsoft stands to make a fortune selling GPT-4 to the public, which would not be possible if OpenAI—as it is required to do—makes the technology freely available to the public. Contrary to the founding agreement, defendants have chosen to use GPT-4 not for the benefit of humanity, but as proprietary technology to maximize profits for literally the largest company in the world."

In his suit, Musk highlighted the 2023 firing and subsequent reinstatement of Sam Altman as CEO. Musk says the temporary ouster prompted Microsoft to step in and force the resignation of the board members who attempted to remove him. The current board members, Musk claims, are no longer scientists and researchers who support and understand the technology.

"OpenAI, Inc.’s once carefully crafted non-profit structure was replaced by a purely profit-driven CEO and a board with inferior technical expertise in AGI and AI public policy. The board now has an observer seat reserved solely for Microsoft," Musk claims.

Musk says in the suit, that the conflict between the board and Altman stemmed from the development of GPT-4 and the potential next iteration of the AGI technology, which Musk worries could compromise public safety.

Microsoft gained exclusive licensing to OpenAI's GPT-3 language model in 2020; and continues to assert rights to GPT-4, which it claims has not reached the level of AGI, which would block its licensing privileges.

The Tesla chief claims Microsoft's hold on Altman and the OpenAI board will keep them from declaring GPT-4 as a AGI in order to keep the technology private and profitable.

Musk's claims include breach of contract, breach of fiduciary duty and unfair business practices against OpenAI. He's asking for the company to revert back to open source; and also requesting an injunction to prevent OpenAI, its president Gregory Brockman and CEO Altman -- named as co-defendants in the case -- as well as Microsoft, from profiting off of the company's artificial general intelligence technology.

Microsoft is not named as a defendant in the suit.

Musk reportedly left OpenAI in 2018 over differences with Altman regarding its direction.

Read the suit: Musk vs Altman