OpenAI countersues Elon Musk, accusing the world's richest person of harassment and sabotage

OpenAI escalated its legal battle with Elon Musk on Wednesday, filing a countersuit that accuses the billionaire entrepreneur of a calculated campaign to undermine the company he once helped found. In a filing submitted to the U.S. District Court for the Northern District of California, OpenAI alleged that Musk had engaged in a “malicious campaign” to obstruct its efforts to evolve into a for-profit business — a transformation the company says is vital to its survival, Reuters reported.

The filing, submitted as part of an ongoing lawsuit Musk initiated earlier this year, seeks to bar him from what OpenAI describes as “further unlawful and unfair action” and urges the court to hold him accountable for what it characterizes as a pattern of disruption and interference.

Musk, who co-founded OpenAI in 2015 alongside current CEO Sam Altman and other tech leaders, parted ways with the nonprofit in 2018. In 2023, he launched xAI, a rival artificial intelligence company, and has since vocally criticized OpenAI’s pivot to a “capped-profit” model - a hybrid structure designed to attract commercial investment while preserving its nonprofit mission.

In order to close a $40 billion fundraising round, OpenAI must complete its corporate transition by the end of this year.

“Through press attacks, malicious campaigns broadcast to Musk’s more than 200 million followers on the social media platform he controls, a pretextual demand for corporate records, harassing legal claims, and a sham bid for OpenAI’s assets, Musk has tried every tool available to harm OpenAI,” the company wrote in its court filing as per reports.

In a separate post on X, the platform formerly known as Twitter, OpenAI accused Musk of acting in bad faith: “Elon’s nonstop actions against us are just bad-faith tactics to slow down OpenAI and seize control of the leading AI innovations for his personal benefit.”

Last month, xAI acquired a stake in X, in a deal that valued the social media company at $33 billion.

Musk, who also serves as chief executive of Tesla and SpaceX, sued OpenAI and Altman last year, claiming the company had abandoned its founding mission to develop artificial intelligence for the benefit of humanity rather than profit. OpenAI and Altman have denied the allegations and accused Musk of attempting to derail a key competitor.