A US jury has ruled against billionaire businessman Elon Musk in his lawsuit accusing OpenAI of abandoning its nonprofit mission and prioritising commercial interests, handing a major legal victory to the Sam Altman-led artificial intelligence (AI) company, and bringing a key chapter in one of Silicon Valley’s bitterest rivalries to a close, at least for now. 

Musk, who co-founded OpenAI in 2015 alongside Altman and others, had accused the company of abandoning its founding mission of building AI for the benefit of humanity rather than for profit. He argued that OpenAI’s shift toward a commercial structure, especially after its deep partnership with Microsoft, violated the original understanding among founders.

Dismissing Musk’s lawsuit, the nine-member jury in Oakland, California, said that the Tesla and SpaceX founder waited too long to bring his claims against OpenAI, and did not resolve the actual substance of Musk’s contentions. Musk had filed the case in 2024.

Even after the verdict by the jury, the fight may not be over. Musk has indicated he plans to appeal, arguing that the court dismissed the case on a “technicality” rather than addressing the substance of his allegations.

From OpenAI’s perspective, the verdict is a crucial win at a time when the company is laying the groundwork for what could become one of the largest technology IPOs in history. Analysts were seeing the lawsuit as a significant financial and governance risk because Musk was seeking to unwind OpenAI’s for-profit restructuring and potentially claim damages running into over $100 billion.

With the case now dismissed, OpenAI removes a major legal overhang ahead of a possible public listing that some reports value at close to $1 trillion. The company has already completed a restructuring into a public benefit corporation last year.

The case and the judgment

Musk had asked the court to force OpenAI’s commercial assets back under nonprofit control. He further demanded the removal of Altman and OpenAI president Greg Brockman from leadership roles.

OpenAI began as a nonprofit AI research lab in 2015, but in 2019 created a “capped-profit” structure to raise the massive funding needed for developing advanced AI systems. The move allowed the company to attract billions of dollars from investors, including Microsoft, while still remaining under nonprofit oversight. Critics, including Elon Musk, argued that the shift marked a departure from OpenAI’s original mission of building AI primarily for public benefit rather than commercial gain. The tensions around governance also came into public view in 2023, when Sam Altman was briefly removed as CEO by OpenAI’s board before being reinstated within days after employee and investor backlash.

The nine-member federal jury unanimously ruled that Musk had filed the lawsuit too late. The jury accepted OpenAI’s argument that Musk was already aware years earlier about the company’s plans to seek outside investment and adopt a more commercial structure. Under US law, the claims therefore fell outside the applicable statute of limitations.

Judge Yvonne Gonzalez Rogers accepted the jury’s findings and dismissed the claims. Importantly, the verdict did not fully resolve the philosophical debate over OpenAI’s transformation. Rather, it concluded that Musk had delayed legal action for too long.

The courtroom battle was only the latest escalation in a feud that has steadily intensified over the past several years.

Musk was one of OpenAI’s earliest backers and contributed around $38 million to the organisation during its nonprofit phase. At the time, OpenAI positioned itself as a counterweight to large technology firms and pledged to prioritise AI safety and public benefit.

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But tensions emerged internally over the company’s direction. According to proceedings in the trial, Musk had pushed for greater control over OpenAI and was frustrated after failing to secure it. He eventually left the board in 2018.

OpenAI later created a “capped-profit” structure that allowed it to raise outside capital while still being governed by a nonprofit parent entity. That shift paved the way for Microsoft’s multibillion-dollar investments and the rapid commercial rise of products like ChatGPT.

Musk became increasingly vocal in criticising Altman and OpenAI, accusing the company of betraying its founding ideals and prioritising profits over AI safety. Altman, meanwhile, has suggested Musk’s attacks stem partly from competitive pressures after the launch of xAI.