OpenAI counter-sues Musk, claims $97B offer was a “sham” to sabotage company

The escalating legal battle between OpenAI and Elon Musk has taken a dramatic turn with OpenAI’s counter-lawsuit, which alleges Musk’s $97.375 billion bid was an elaborate sabotage attempt rather than a legitimate acquisition offer. This conflict represents a significant power struggle in the artificial intelligence industry, potentially impacting the future development trajectory of advanced AI systems and highlighting the increasingly personal nature of competition between AI companies and their founders.

The big picture: OpenAI has counter-sued Elon Musk, claiming his nearly $100 billion acquisition bid was a “sham” deliberately timed to disrupt the company and scare away legitimate investors.

• The lawsuit alleges Musk’s bid amount of $97.375 billion appears to reference his favorite sci-fi novel, Iain Banks’ “Look to Windward,” rather than being based on OpenAI’s actual financial metrics.
• OpenAI claims Musk provided “no evidence of financing” to support the massive purchase price, further suggesting the offer was not genuine.

Key allegations: OpenAI portrays Musk as attempting to become an “AGI dictator” through gaining control of the company while conducting a “relentless” campaign of harassment.

• The company claims Musk previously sought to have OpenAI absorbed into Tesla in 2018, a proposal that was rejected.
• According to the filing, Musk has since launched rival company xAI and engaged in activities designed to harm OpenAI.

Legal demands: OpenAI is seeking a jury trial, an injunction to halt Musk’s alleged unfair business practices, and financial compensation.

• The company wants Musk to cover costs incurred from reviewing his bid and pay punitive damages for allegedly engaging “in wrongful conduct with malice, oppression, and fraud.”
• OpenAI argues Musk’s actions are designed to impair competition “for the sole benefit of Musk’s xAI” at the expense of public interest.

Reading between the lines: OpenAI is attempting to distance itself from its co-founder while portraying Musk’s actions as self-serving and detrimental to AI advancement.

• The company publicly acknowledged Musk’s entrepreneurial achievements while dismissing his current behavior, stating on X: “Elon is undoubtedly one of the greatest entrepreneurs of our time. But these antics are just history on repeat—Elon being all about Elon.”
• The lawsuit suggests OpenAI fears Musk could potentially “tank” its revenue similar to what happened after his acquisition of Twitter.