- Altman testified Tuesday that OpenAI never abandoned its nonprofit mission.
- Musk had called himself a “fool” for funding what became an $800 billion company.
- The trial hinges on whether OpenAI’s for-profit pivot broke a founding agreement to benefit humanity.
Sam Altman took the stand Tuesday in Oakland federal court to defend OpenAI’s nonprofit roots—and immediately reframed Elon Musk’s $44 million in early funding as exactly what it was legally: a tax deduction, not an ownership stake.
“The perfidy and deceit are of Shakespearean proportions,” Musk’s lawyers wrote in court filings, accusing Altman of running a “long con” to transform a charity into a for-profit AI powerhouse now worth hundreds of billions. Musk himself testified he was “a fool” for providing the funding that created an $800 billion company. Altman pushed back directly: Musk knew what he was doing.
OpenAI has rejected the lawsuit as “motivated by jealousy,” stating Musk was always aware of plans for the business and left in 2018 after a failed bid to take over. The company holds that his contributions were charitable donations, not equity, and do not entitle him to any governance rights. Both Altman and OpenAI president Greg Brockman were in the courtroom as the world’s richest man squared off against the CEO of the world’s most valuable AI startup.
Only 2 of 26 Claims Survived
Musk filed the lawsuit in 2024 with 26 claims. Most were dismissed ahead of trial—fraud and constructive fraud claims were dropped to “streamline the case,” according to a filing reported by CNBC. What remains: unjust enrichment and breach of charitable trust. Musk is seeking up to $134 billion in disgorged gains, though he has since asked the court to redirect any damages to OpenAI’s nonprofit arm rather than to himself personally.
The trial before Judge Yvonne Gonzalez Rogers in U.S. District Court in Oakland has drawn a rare combination of tech industry spectacle and legal precedent. A nine-person jury was seated Monday. Court observers lined up before dawn; the judge threatened to shut down an overflow room after observers repeatedly violated bans on photography and video recording.
“It is not okay to steal a charity, that’s my view,” Musk told jurors on Tuesday. His lawyers argue OpenAI became a de facto Microsoft subsidiary after its $13 billion investment, abandoning the founding agreement to build AI that benefits humanity rather than maximize shareholder returns.
The Witness List Is a Tech Hall of Fame
Beyond Altman and Musk, the witness list reads like a tech industry org chart: former OpenAI chief scientist Ilya Sutskever, former CTO Mira Murati, and Microsoft CEO Satya Nadella are all expected to testify, according to MIT Technology Review. The case could set precedent for how AI companies structure relationships between nonprofit research arms and for-profit commercial subsidiaries—a governance question that affects billions in Silicon Valley investment.
OpenAI’s transformation from nonprofit research lab to $800 billion commercial enterprise happened fast. The company launched ChatGPT in late 2022, landed $13 billion from Microsoft, and has since raised at an announced valuation of $300 billion or more. Musk argues that transformation broke a founding promise. Altman says it was always the plan.
The trial continues this week.