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OpenAI Countersues Elon Musk, Alleges Attempted Hostile Takeover
In a stunning turn of events, OpenAI has filed a countersuit against Elon Musk, alleging that the Tesla CEO attempted to engage in a hostile takeover of the AI research organization.
According to the lawsuit, Musk proposed spinning OpenAI into Tesla in January 2018, arguing it was the only way to raise the billions needed to compete with Google. The move, however, was rejected by OpenAI’s team, who were unwilling to become a subsidiary of the electric vehicle giant.
The countersuit further alleges that Musk resigned as co-chair and parted ways with the company shortly after his proposal was rejected. However, he did not abandon his ambitions entirely, instead choosing to take legal action against OpenAI in March this year.
In his lawsuit, Musk sought to block OpenAI’s transition to a capped-profit structure, citing concerns over its non-profit status. A U.S. judge ultimately denied the injunction, but agreed to an expedited trial set for fall 2025.
The countersuit from OpenAI claims that Musk’s actions were motivated by his desire to merge OpenAI with Tesla and gain control of the organization. It also accuses him of attempting to disrupt its operations through various means, including a “sham bid” designed to buy out the company at an inflated price.
“The idea that we abandoned our mission is false,” said OpenAI in a statement. “Elon’s own emails make it clear that he was never interested in supporting OpenAI unless he could control it.”
The legal battle comes as both companies have made significant financial moves recently. Musk’s AI startup xAI merged with his social media platform X in an all-stock deal valuing the company at $80 billion, while OpenAI announced a record-breaking $40 billion funding round led by SoftBank.
OpenAI’s valuation has skyrocketed to nearly four times that of xAI, fueling speculation about the motivation behind Musk’s actions. “We’re getting ready to build the best-equipped nonprofit the world has ever seen,” the company said in its countersuit.
Source: https://blockonomi.com/openai-countersues-elon-musk-alleges-attempted-hostile-takeover/
