In December 2015, Elon Musk and Sam Altman sat across a table in San Francisco and agreed to build something unusual: an artificial intelligence research laboratory that would operate as a charity, free from the pressure of shareholders and the distortions of profit motive, dedicated to the development of AI for the benefit of all humanity. They called it OpenAI. Musk contributed more than $44 million of the seed funding that gave the organisation its early life. Altman became its CEO. Greg Brockman became its president. For a brief period, the three men shared a vision of what responsible AI development could look like.
On Tuesday, April 28, 2026, Elon Musk and Sam Altman faced each other across a very different kind of table — a federal courtroom in Oakland, California, where a nine-person jury composed of nurses, city workers, and retirees is now tasked with adjudicating one of the most consequential commercial disputes in the history of the technology industry. The question before the court is not merely who is right about what was promised in 2015. It is whether those promises constituted binding legal commitments, whether their abandonment constitutes actionable fraud and breach of charitable trust, and what remedy, if any, a court can impose on a company worth more than $850 billion for having allegedly violated the terms of its own founding.
What Musk Is Claiming and What He Is Asking For
Musk’s lawsuit, filed in 2024 and whittled down through pre-trial proceedings from 26 original claims to two — unjust enrichment and breach of charitable trust — rests on a straightforward factual assertion: that OpenAI was founded as a nonprofit with an explicit mission to develop AI for humanity’s benefit, that he contributed tens of millions of dollars in reliance on that mission, and that Altman and Brockman subsequently transformed the organisation into a “wealth machine” for themselves and investors, betraying both the founding mission and the donors who funded it.
The transformation Musk objects to began in March 2019, when OpenAI created a for-profit subsidiary — technically still controlled by the nonprofit parent, but operating as a commercial entity capable of raising investment capital and generating returns for shareholders. That structure attracted Microsoft, which ultimately invested approximately $13 billion. It attracted billions more in successive funding rounds. The company’s most recent valuation stands at approximately $852 billion, with a potential IPO that could value it at close to $1 trillion under active planning.
Musk left OpenAI’s board in 2018, more than a year before the for-profit subsidiary was created. He says he was “assiduously manipulated” and “deceived.” His lawyers described the alleged perfidy in a court filing with characteristic drama: “The perfidy and deceit are of Shakespearean proportions,” they wrote, characterising Altman’s conduct as “a long con.” Musk has described Altman on his social media platform X as “Scam Altman” and Greg Brockman as “Greg Stockman.” Opening day on Monday produced another salvo: “Scam Altman and Greg Stockman stole a charity. Full stop.”
He is seeking $150 billion in damages from OpenAI and Microsoft, with any recovery directed to OpenAI’s charitable arm rather than to himself personally. He also wants the court to unwind the for-profit conversion, restore OpenAI to pure nonprofit status, and remove Altman and Brockman from their roles at the company and its board. The remedies he is seeking, if granted, would essentially destroy the commercial structure that has made OpenAI one of the most valuable private companies in the world.
What OpenAI Says
OpenAI’s defence rests on two pillars, each of which directly contradicts a core element of Musk’s narrative.
The first pillar is factual: OpenAI says Musk was not deceived. He knew the for-profit conversion was being contemplated, participated in discussions about it, and was — according to OpenAI’s filings — an active advocate for it when it seemed likely to give him greater control over the organisation. OpenAI has said Musk repeatedly pressed to become CEO himself, and that when those efforts failed and Altman consolidated control, Musk departed — and then, years later, filed a lawsuit.
The second pillar is motivational: OpenAI describes the lawsuit as a “baseless and jealous bid to derail a competitor.” The timing is difficult to ignore. Musk filed suit in 2024, approximately one year after he founded xAI — his own AI company, now merged into SpaceX — in direct competition with OpenAI. His AI model, Grok, trails OpenAI’s ChatGPT substantially in user numbers. His lawsuit, if successful in its most extreme remedies, would effectively remove OpenAI from the competitive landscape at a moment when that competition is most significant to his own commercial interests.
“This lawsuit has always been a baseless and jealous bid to derail a competitor,” OpenAI wrote on its Newsroom account on Monday. “We can’t wait to make our case in court where both the truth and the law are on our side.”
Tech journalist Casey Newton, founder of the Platformer newsletter, offered the most succinct framing of the underlying dynamic: “This is a clash of two enormous personalities in Elon Musk and Sam Altman. What is at stake is potentially the future of OpenAI and the future development of all AI.” Tech observer Alex Kantrowitz put the motivational question differently: “This is part business case and part ego. For Elon, pride matters more than money here.”
The Legal Architecture and the IPO Risk
Judge Yvonne Gonzalez Rogers has divided the trial into two phases. The first phase — currently underway, with jury deliberations on liability targeted to begin by May 12 — asks jurors to determine whether Altman, Brockman, and OpenAI committed the wrongs Musk alleges. If the jury finds them liable, the case moves to a remedies phase in which both sides will argue to the judge what should be done about it.
The legal standard for breach of charitable trust is specific: it requires demonstrating that the trustees of a charitable organisation departed from the terms of its founding mission in ways that were not authorised, and that the departure caused harm. Whether creating a for-profit subsidiary that now generates hundreds of billions of dollars in investor returns constitutes such a departure — or whether it represents a legitimate evolution of an organisation that concluded it could not fulfil its mission without commercial capital — is the question the jury must ultimately answer.
The trial’s timing could not be more commercially consequential for OpenAI. The company recently closed a $122 billion funding round and is planning an initial public offering that Reuters has reported could value the company at $1 trillion. A jury verdict finding OpenAI’s leadership liable for breach of charitable trust — even if the remedies are eventually modest — would cast a cloud of legal uncertainty over that IPO at the worst possible moment. The testimony expected from Altman himself, and from Microsoft CEO Satya Nadella, will be scrutinised by investors and regulators as much as by the jury.
Last autumn, OpenAI restructured again, converting to a public benefit corporation — a hybrid structure that is simultaneously more investor-friendly and retains the charitable mission in its corporate charter. The nonprofit arm retained a 26% stake plus warrants. OpenAI has argued this restructuring addresses the concerns at the heart of Musk’s lawsuit. Musk’s lawyers disagree, arguing it entrenches rather than remedies the original breach.
Why This Trial Matters Beyond the Courtroom
The Musk vs. Altman trial is not merely a dispute between two billionaires about who owns what in a company neither fully controls. It is a public examination of a question that the AI industry has collectively avoided answering directly: what does it actually mean to build AI for humanity’s benefit, and who gets to decide when that mission has been abandoned?
OpenAI was not the only organisation to begin as an idealistic nonprofit and evolve toward commercial structures as the cost of competing became clear. The entire AI research landscape has followed a similar arc, driven by the simple reality that training large language models requires billions of dollars of compute infrastructure that only commercial capital can provide. The tension between the founding idealism and the operational necessity is not unique to OpenAI. It is the defining structural tension of the AI era.
What is unique about OpenAI is that it made the idealism explicit — in its founding documents, in its public communications, in the commitments it made to early donors — and that one of those early donors is now, in a federal courtroom with nine jurors in attendance, asking a court to hold the organisation to those explicit commitments.
If Musk wins, the AI industry will be watching what the court does to one of its most important companies. If Altman wins, the AI industry will have a legal precedent establishing that the evolution from nonprofit mission to commercial juggernaut can survive charitable trust scrutiny — a precedent with implications that extend well beyond OpenAI.
Either way, the nine jurors in Oakland are now among the most consequential decision-makers in the global technology industry. They begin deliberations by May 12. The rest of the world is watching.
Written by Shalin Soni, CMA specializing in financial analysis, global markets, and corporate strategy, with hands-on experience in financial planning and analytical decision-making.
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Source: Based on CNBC and publicly available financial information.