Elon Musk v OpenAI trial opens in Oakland as Musk testifies Altman 'looted' the AI nonprofit and seeks $150 billion in damages
The trial between Elon Musk and OpenAI — including its chief executive Sam Altman and investor Microsoft — has commenced at the US District Court in Oakland, California, before Judge Yvonne Gonzalez Rogers. A nine-member jury will hear evidence over what is expected to be a month-long trial. Musk is seeking $150 billion in damages and an order that OpenAI unwind its conversion from a nonprofit organisation into a for-profit corporate structure. On the first day of testimony, Musk alleged that Altman had "looted" the nonprofit he co-founded, characterising OpenAI's structural transformation as the theft of a charity. His lead counsel, Steven Molo, compared OpenAI's conversion to a museum store appropriating the museum's collection for private profit. OpenAI's lead counsel, William Savitt, dismissed Musk's claims as "sour grapes" — arguing that Musk became litigious only after OpenAI's ChatGPT became commercially successful in 2022, years after Musk himself departed the organisation in 2018. OpenAI is currently valued at approximately $730 billion. Microsoft, which has invested heavily in the company, was also named as a defendant. Judge Gonzalez Rogers admonished Musk about social media posts targeting OpenAI prior to the start of proceedings, asking both parties to maintain a clean slate online during the trial.
Why this matters
The Musk v OpenAI trial is one of the highest-value commercial disputes in the world at present, with implications that extend far beyond the parties. The central legal question — whether a nonprofit's founders can constrain a subsequent for-profit conversion — is novel at this scale and will produce precedent relevant to the governance of charitable organisations and technology companies globally. For City firms with international dispute resolution and corporate governance practices, the case is a reference point for advising clients on the legal risks of structural transformation of charitable entities, fiduciary obligations of founders, and the enforceability of founding documents. The $730 billion valuation of OpenAI means the stakes of any injunctive relief are extraordinary. London-based practitioners should also note that OpenAI's global operations and Microsoft's European presence give this litigation indirect relevance to cross-border corporate governance advice.
On the Ground
A trainee supporting international counsel co-ordinating on this litigation would prepare a cross-border legal opinion coordination note — summarising applicable US nonprofit law and relevant fiduciary duty frameworks as a reference for London partners advising clients on analogous charitable-to-commercial conversion structures. They would also assist with chronology preparation, documenting the key dates of OpenAI's structural changes alongside Musk's departure and investment history.
Interview prep
Soundbite
A $150bn damages claim over a charity-to-corporation conversion will define the legal limits of nonprofit structural transformation for a generation.
Question you might get
“What legal duties does a founding member of a nonprofit organisation owe to the organisation's charitable purpose, and how might those duties constrain a subsequent decision to convert the entity into a for-profit company?”
Full answer
The Musk v OpenAI trial has opened in Oakland with Musk seeking $150 billion in damages and an order to unwind OpenAI's conversion from a nonprofit into a for-profit company now valued at $730 billion. The core legal issue is whether OpenAI's founders were bound by charitable obligations that prevented the structural conversion — a question with no clear precedent at this scale. For City law firms, the case is a corporate governance reference point: clients involved in charity-to-commercial conversions, or in charitable foundations holding valuable assets, face directly analogous fiduciary and structural questions. Microsoft's inclusion as a defendant also raises investor protection angles relevant to London M&A counsel. The verdict is likely to influence how future AI company governance documents are drafted globally, making this essential background for any lawyer advising tech sector clients.
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