Musk Calls OpenAI’s Shift to For-Profit a ‘Long Con’ for Personal Gain

Plaintiff Elon Musk (“Musk” or “Plaintiff”), for his complaint against defendants Samuel Altman (“Altman”), Gregory Brockman (“Brockman”), OpenAI, Inc., OpenAI, L.P., OpenAI, L.L.C., OpenAI GP, L.L.C., OpenAI OpCo, LLC, OpenAI Global, LLC, OAI Corporation, LLC, OpenAI Holdings, LLC, OpenAI Investment LLC, OpenAI Startup Fund Management, LLC, OpenAI Startup Fund GP I, L.L.C., OpenAI Startup Fund I, L.P., OpenAI Startup Fund SPV GP I, L.L.C., OpenAI Startup Fund SPV GP II, L.L.C., OpenAI Startup Fund SPV GP III, L.L.C., OpenAI Startup Fund SPV GP IV, L.L.C., OpenAI Startup Fund SPV I, L.P., OpenAI Startup Fund SPV II, L.P., OpenAI Startup Fund SPV III, L.P., OpenAI Startup Fund SPV IV, L.P., Aestas Management Company, LLC, and Aestas, LLC1 (collectively, “Defendants”), alleges as follows:

Musk: OpenAI's "Hot Air Philanthropy", a "Long Con" for Personal Gain

NATURE OF THE ACTION

1. Elon Musk’s case against Sam Altman and OpenAI is a textbook tale of altruism versus greed. Altman, in concert with other Defendants, intentionally courted and deceived Musk, preying on Musk’s humanitarian concern about the existential dangers posed by artificial intelligence (“AI”). Altman and his long-time associate Brockman assiduously manipulated Musk into co-founding their spurious non-profit venture, OpenAI, Inc., by promising that it would chart a safer, more open course than profit-driven tech giants. The idea Altman sold Musk was that a non-profit, funded and backed by Musk, would attract world-class scientists, conduct leading AI research and development, and, as a meaningful counterweight to Google’s DeepMind in the race for Artificial General Intelligence (“AGI”), decentralize its technology by making it open source. Altman assured Musk that the non-profit structure guaranteed neutrality and a focus on safety and openness for the benefit of humanity, not shareholder value. But as it turns out, this was all hot-air philanthropy—the hook for Altman’s long con.

2. After Musk lent his name to the venture, invested significant time, tens of millions of dollars in seed capital, and recruited top AI scientists for OpenAI, Inc., Musk and the non-profit’s namesake objective were betrayed by Altman and his accomplices. The perfidy and deceit are of Shakespearean proportions.

   
   

3. Once OpenAI, Inc.’s technology approached transformative AGI, Altman flipped the narrative and proceeded to cash in. In partnership with Microsoft, Altman established an opaque web of for-profit OpenAI affiliates, engaged in rampant self-dealing, seized OpenAI, Inc.’s Board, and systematically drained the non-profit of its valuable technology and personnel. The resulting OpenAI network, in which Altman and Microsoft hold significant interests, was recently valued at a staggering $100 billion.

   
   

4. The world has gotten wise to Defendants’ scheme. Not only are there several pending lawsuits against OpenAI, Inc. over its unlawful practices, but Defendants are also under investigation by multiple federal agencies, including the Securities and Exchange Commission and the Federal Trade Commission, and are the subject of numerous consumer advocacy complaints to the California Attorney General. A recent spate of OpenAI executives and insiders have blown the whistle on Altman, exposing his unscrupulous maneuvering and self-dealing. Indeed, just this June it was reported that Altman, foregoing any further humanitarian pretense, proposed to OpenAI’s stakeholders that it be converted to an entirely for-profit enterprise, shielding Defendants from public oversight and the mandatory financial disclosures of a non-profit.

   
   

5. As a result of their unlawful actions, Defendants have been unjustly enriched to the tune of billions of dollars in value, while Musk, who co-founded their de-facto for-profit start-up, has been conned along with the public, whom its vital technology was supposed to benefit. Musk brings this remedial action to divest Defendants of their ill-gotten gains.

[1] This Complaint hereinafter uses “OpenAI” to refer to the non-profit (OpenAI, Inc.) and all entity Defendants, collectively.