OpenAI CEO Sam Altman Faces $134B Lawsuit as Musk Trial

Elon Musk is seeking up to $134 billion in damages from OpenAI and Microsoft in a federal trial that began in May 2026, alleging that CEO Sam Altman and president Greg Brockman deceived him into donating $38 million to what he believed would remain a nonprofit AI company. According to court filings, Musk wants the court to remove Altman and Brockman from their roles and unwind OpenAI’s 2025 restructuring that converted its for-profit subsidiary into a public benefit corporation.

The trial has revealed previously undisclosed details about OpenAI’s internal dynamics, including Musk’s failed 2018 attempt to recruit Altman to lead an AI lab at Tesla and threatening text messages sent just days before the trial began.

Musk’s Failed Tesla Recruitment Attempt

Testimony from Shivon Zilis, a former OpenAI board member and mother of four of Musk’s children, revealed that Musk tried to recruit Altman to join Tesla in early 2018. According to Wired, Musk offered Altman a position leading a “world-class AI lab” within Tesla and even proposed giving him a Tesla board seat.

Emails presented as evidence showed Zilis acting as an intermediary between Musk and Altman during these negotiations. In a February 2018 text, Zilis asked Altman, “Did you think through a B Corp subsidiary of Tesla?” OpenAI’s legal team argues this demonstrates Musk’s intention to “corrupt OpenAI and absorb it into Tesla.”

The recruitment effort occurred just months before Musk left OpenAI’s board in February 2018, following what OpenAI describes as a failed power struggle for “absolute control” over the company.

Threatening Messages Before Trial

Just two days before the trial began, Musk sent what OpenAI characterizes as threatening text messages to Brockman and Altman. According to TechCrunch, after Musk suggested settling the lawsuit and Brockman replied by proposing both sides drop their suits, Musk responded: “By the end of this week, you and Sam will be the most hated men in America. If you insist, so it will be.”

While the judge ruled this text exchange inadmissible as evidence, OpenAI’s lawyers argue it reveals Musk’s true motivations are financial rather than concerns about AI safety. The exchange suggests Musk was seeking monetary compensation from OpenAI’s success while attempting to damage a competitor to his own AI company, xAI.

Revelations About Altman’s 2023 Ouster

The trial has also provided new details about the dramatic November 2023 weekend when OpenAI’s board briefly fired Altman. According to The Verge, videotaped testimony from former CTO Mira Murati offered the first concrete look behind the scenes of that chaotic period.

While the specific details of Murati’s testimony remain under court seal, her deposition addressed the board’s original explanation that Altman was “not consistently candid in his communications with the board.” The testimony provides context for what became the AI industry’s biggest leadership crisis, which ended with Altman’s reinstatement and a complete board restructuring.

Former OpenAI board member Helen Toner also provided videotaped testimony raising concerns about Altman’s alleged history of deception, though specific details were not disclosed in court reporting.

Microsoft CEO Set to Testify

Microsoft CEO Satya Nadella is scheduled to appear in court on Monday, May 11th, followed by former OpenAI chief scientist Ilya Sutskever. According to MIT Technology Review, Microsoft’s testimony will be crucial given the company’s multi-billion dollar investment in OpenAI and its licensing agreement for the company’s AI models.

Microsoft’s restructuring deal gives the company 27% access to OpenAI’s AI models through 2032. Musk’s lawsuit seeks to strip this licensing agreement entirely, which could fundamentally alter the partnership that has powered both companies’ AI strategies.

Competing Narratives

Musk’s legal team argues that Altman and Brockman violated their fiduciary duties by transforming a nonprofit dedicated to developing AI “for the benefit of humanity” into a profit-driven entity now valued at over $800 billion. They claim Musk was deceived about OpenAI’s true intentions when he provided his $38 million in early funding.

OpenAI’s defense centers on the argument that Musk is driven by “sour grapes” after failing to gain control of the company in 2017. According to OpenAI’s statement, the lawsuit is “baseless” and motivated by Musk’s competitive interests rather than genuine concern about AI safety.

Greg Brockman’s testimony directly contradicted Musk’s claims, arguing that Musk himself had pushed for OpenAI to create a for-profit structure and fought for “absolute control” over it. This testimony suggests the current lawsuit represents retaliation for Musk’s failed takeover attempt.

What This Means

The trial’s outcome could fundamentally reshape OpenAI’s structure and derail its planned IPO at a valuation approaching $1 trillion. If Musk succeeds in unwinding OpenAI’s for-profit conversion, it could force the company back to a purely nonprofit model, potentially ending its partnership with Microsoft and limiting its ability to raise capital for AI development.

The case also highlights the broader tension in AI development between open, safety-focused research and commercial competitiveness. Musk’s founding of xAI in 2023 as a for-profit venture within SpaceX undercuts his nonprofit purity arguments, suggesting the dispute is more about market position than altruistic AI development.

For the AI industry, the trial represents a pivotal moment in determining whether early mission statements and founding principles can legally constrain companies as they scale and require massive capital investments. The precedent could influence how future AI companies structure their governance and funding models.

FAQ

What exactly is Elon Musk suing OpenAI for?
Musk is seeking up to $134 billion in damages and wants the court to remove Sam Altman and Greg Brockman from their leadership roles, unwind OpenAI’s for-profit restructuring, strip Microsoft’s licensing agreement, and require OpenAI’s technology be made publicly available. He claims they violated their fiduciary duties by converting a nonprofit into a profit-driven company.

How much money did Musk originally invest in OpenAI?
Musk provided $38 million to OpenAI during its early years as a co-founder before leaving the board in February 2018. He claims this investment was made under the understanding that OpenAI would remain a nonprofit dedicated to developing AI for humanity’s benefit.

What could happen to ChatGPT if Musk wins the lawsuit?
If Musk’s lawsuit succeeds, OpenAI could be forced to return to a nonprofit structure, potentially ending its Microsoft partnership and requiring its AI technology to be made publicly available. This could significantly impact ChatGPT’s development and commercial availability, though the specific implications would depend on the court’s exact ruling.