Elon Musk Expands Lawsuit Against OpenAI, Targets Microsoft Over Antitrust Concerns

Elon Musk, the billionaire entrepreneur, has broadened his legal battle against OpenAI, the developer of ChatGPT. His revised lawsuit now includes Microsoft, OpenAI’s major financial backer, as a defendant, with fresh allegations of federal antitrust violations and other legal claims.

The updated lawsuit, submitted on Thursday in a federal court in Oakland, California, accuses Microsoft and OpenAI of attempting to dominate the generative artificial intelligence market, potentially shutting out competitors. This follows Musk's initial lawsuit from August, which claimed that OpenAI, led by CEO Samuel Altman, violated contractual agreements by prioritizing profits over the public interest in AI development.

The complaint highlights how OpenAI has rapidly transformed from a tax-exempt nonprofit to a $157 billion for-profit entity in just eight years, describing it as a "market-paralyzing gorgon." The lawsuit aims to nullify OpenAI's licensing agreement with Microsoft and demands that any gains deemed improperly acquired be relinquished.

In response to the legal action, OpenAI dismissed the expanded lawsuit as "even more baseless and overreaching" than previous claims, while Microsoft opted not to comment on the matter. Musk’s legal representative, Marc Toberoff, emphasized concerns over Microsoft’s business practices, asserting, “Sunlight is the best disinfectant.”

Musk's conflict with OpenAI is not new. He initially co-founded the AI company, which has since become a leading name in generative AI, thanks to substantial financial support from Microsoft. His latest legal step comes as Musk takes on a more prominent role in U.S. politics, having been appointed by President-elect Donald Trump to a new government position focused on reducing waste, following significant contributions to Trump's campaign.

The revised lawsuit also claims that OpenAI and Microsoft broke antitrust laws by tying investment opportunities to agreements that restrict dealings with rival companies. It further alleges that the exclusive licensing arrangement between the two companies is akin to an unapproved merger.

OpenAI, in a court filing last month, accused Musk of using the lawsuit as a tactic to undermine them for his own competitive advantage.

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