Elon Musk Hits OpenAI With “Breach Of Contract” Lawsuit

Elon Musk hits OpenAI with a breach of contract lawsuit, claiming it engages in unfair business tactics and breaches fiduciary duties.

Elon Musk Hits OpenAI With "Breach Of Contract" Lawsuit 1

In a lawsuit that was submitted on Thursday night to the San Francisco Superior Court, Elon Musk alleges that OpenAI, the company that makes ChatGPT, and its CEO, Sam Altman, among others, violated the basic principles of the artificial intelligence startup, which prioritizes people before profit.

“These events of 2023 constitute flagrant breaches of the Founding Agreement, which Defendants have essentially turned on its head. To this day, OpenAI, Inc.’s website continues to profess that its charter is to ensure that AGI [artificial general intelligence technology] “benefits all of humanity,” the lawsuit reads.

According to a Monday filing by OpenAI in Manhattan federal court, Microsoft and OpenAI allege that the NY Times hacked ChatGPT to replicate its content.

It goes on: “OpenAI, Inc. has, in actuality, become a de facto closed-source subsidiary of Microsoft, the biggest technology firm in the world. Instead of constructing an AGI for the good of humanity, under its new Board, it is refining it to maximize profits for Microsoft.”

Elon Musk Hits OpenAI With "Breach Of Contract" Lawsuit 2

In addition to contract violations, Musk claims that OpenAI engages in unfair business tactics and breaches fiduciary duties. He demands that the startup return to an open-source model to serve humanity. The billionaire seeks an injunction to stop Microsoft, Altman, Gregory Brockman, and OpenAI from profiting from the startup’s artificial intelligence technologies.

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Musk claims that Microsoft, Altman, and Brockman worked together to remove the startup’s board members responsible for maintaining its core values.

“Mr. Altman hand-picked a new Board that lacks similar technical expertise or any substantial background in AI governance, which the previous board had by design,” the lawsuit said, adding, “The new Board consisted of members with more experience in profit-centric enterprises or politics than in AI ethics and governance. They were also reportedly ‘big fans of Altman.'”

Musk claims that the GPT-4 model developed by OpenAI and published a year ago is still closed. He stated that rather than the interests of humanity, this is primarily the result of business reasons.

“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 … 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,” Musk said. 

He adds: “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 2018, Musk, an original OpenAI board member, left the company. He was a co-founder of the firm in 2015.

View the lawsuit in its entirety here:

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