OpenAI hit back at billionaire Elon Musk on Friday, releasing a series of emails and texts in which the company claims Musk's lawsuit against the company is misleading.
At the heart of Mr. Musk's legal battle with OpenAI, which has been going on for months, is the company's abandonment of its original nonprofit mission of making the fruits of AI research available to everyone. Things escalated further last month when Musk's legal team filed for an injunction to halt OpenAI's ongoing transition from a nonprofit to a for-profit entity.
OpenAI says Musk's complaints are unfounded and nothing more than sour grapes.
Musk proposed the idea for OpenAI with both nonprofit and for-profit components in 2015, according to emails and documents released by OpenAI. OpenAI eventually launched as a nonprofit organization, but faced funding challenges after a few years.
On June 13, 2017, Musk indicated that OpenAI would merge with a hardware startup, possibly with chip company Cerebras, according to an exchange published by OpenAI. According to the message, several members of OpenAI's leadership agreed, and OpenAI started on the path to what president Greg Brockman calls “AI research + commercial hardware.”
OpenAI claims Musk asked for a majority stake — between 50% and 60%. He then established an organizational structure in which he had “unambiguous initial control of the company” and assumed the role of CEO.
Musk went so far as to establish a public benefit corporation called Open Artificial Intelligence Technologies, Inc., registered in Delaware. But OpenAI leadership rejected Musk's conditions.
Musk then recommended that OpenAI be spun off into his electric car company, Tesla, with a $1 billion budget that would “grow exponentially.” OpenAI leadership also rejected this proposal.
At this point in 2018, Musk resigned from OpenAI and largely severed ties with senior management. OpenAI claims it has offered shares to Musk multiple times in the commercial sector, but Musk has always declined.
“You can’t litigate your way.” [artificial general intelligence,]” OpenAI said in a statement. “While we have great respect for Elon's work and are grateful for his early contributions to OpenAI, he should be competing in the marketplace, not in the courtroom.”
Musk formed xAI, his answer to OpenAI, last year. Shortly thereafter, the company released Grok, an AI model that now powers many of the features of Musk's social network X, formerly known as Twitter. xAI also provides an API that allows customers to embed Grok into third-party apps, platforms, and services.
In a complaint filed late last month, Musk's lawyers argued that OpenAI was depriving xAI of capital by extracting promises from investors not to fund competition with xAI. In October, the Financial Times reported that OpenAI asked investors in its latest funding round to also refrain from funding OpenAI's rivals, including xAI.
Of course, xAI hasn't had any trouble raising funding lately. The company reportedly closed a $6 billion round last month with participation from prominent investors including Andreessen Horowitz and Fidelity. xAI has about $12 billion in the bank, making it one of the most well-funded AI companies in the world.
Musk's motion for an injunction also alleges that OpenAI and its close collaborator and investor Microsoft are illegally sharing confidential information and resources. Google also reportedly called for an investigation into Microsoft's relationship with OpenAI, specifically the two organizations' cloud computing agreements.
OpenAI is under pressure to quickly complete its transition to commercial use. Investors in the latest funding round will get their money back if OpenAI doesn't transform from a nonprofit within two years, according to Bloomberg.