Business Essentials for Professionals


OpenAI Refutes Allegations In Elon Musk Lawsuit And Said No Founding Agreement Was Ever There

OpenAI Refutes Allegations In Elon Musk Lawsuit And Said No Founding Agreement Was Ever There
Elon Musk, the CEO of Tesla, sued the startup earlier this month, and OpenAI has contested a fundamental assertion he made.
OpenAI is facing numerous legal challenges as it tries to market its ChatGPT chatbot and underlying AI algorithms, including the Musk lawsuit and cases for copyright infringement from the New York Times and writers. In response to Musk's complaint last week, OpenAI released communications pertaining to him dating back to the company's early days and mocked it in a note to staff members.
In his case filed earlier this month, Elon Musk, who asserted breach of contract at the firm he supported, made reference to a 2015 "founding agreement" that he and two other co-founders of OpenAI, Sam Altman and Greg Brockman, had.
According to Musk, the three of them agreed that the new AI lab will be nonprofit and dedicated to serving humanity, not holding secrets secret for profit.
He continued by saying that OpenAI had broken that promise by publishing the GPT-4 large language model last year without making available scientific facts for public consumption.
“There is no Founding Agreement, or any agreement at all with Musk, as the complaint itself makes clear,” OpenAI said in a document on file with California’s superior court for San Francisco County. “The Founding Agreement is instead a fiction Musk has conjured to lay unearned claim to the fruits of an enterprise he initially supported, then abandoned, then watched succeed without him.”
Musk said that OpenAI had "memorialised" the founding agreement, citing the company's 2015 certificate of incorporation filed with the Delaware secretary of state. However, in response, OpenAI stated that Musk's complaint was devoid of a formal contract.
The Microsoft-backed business dismissed Musk's assertions as baseless. However, it stated in a blog post on Monday that it was requesting that the court classify the case as complicated and assign it to a specialised case manager because it incorporates artificial intelligence and has been making claims for over ten years.
Regarding OpenAI's 2017 proposal to form a for-profit company, Musk said in his complaint that he advised Brockman, Altman, and co-founder Ilya Sutskever to "[e]ither go do something on your own or continue with OpenAI as a nonprofit."
In its March 6 filing, OpenAI stated that in the event that the matter proceeded to discovery, evidence would demonstrate Musk's support for the startup's transition to a for-profit organisation.
Grok, a chatbot developed by Musk's own AI lab, X.AI, is accessible via X, the company he bought in 2022. X was formerly known as Twitter. This week, the business will make Grok's code available to the public, according to a Monday X post by Musk.
As of November, 100 million people used OpenAI's ChatGPT every week.
“Seeing the remarkable technological advances OpenAI has achieved, Musk now wants that success for himself,” OpenAI said in its filing. “So he brings this action accusing Defendants of breaching a contract that never existed and duties Musk was never owed, demanding relief calculated to benefit a competitor to OpenAI.”

Christopher J. Mitchell

Markets | Companies | M&A | Innovation | People | Management | Lifestyle | World | Misc