Elon Musk has intensified his legal battle with OpenAI, urging attorneys-general in California and Delaware to compel the auction of a significant stake in the company, according to the Financial Times. Through his lawyer, Marc Toberoff, Musk claimed that a competitive bidding process would ensure maximum value for OpenAI’s non-profit assets and uphold its fiduciary duties.
The move is part of Musk’s ongoing efforts to challenge OpenAI’s restructuring from a non-profit to a for-profit entity. Musk co-founded OpenAI in 2015 but left the board in 2018 after disputes with CEO Sam Altman. The company later formed a for-profit subsidiary to attract capital, including over $13 billion from Microsoft.
OpenAI is currently working to transition into a public benefit corporation (PBC), a structure aimed at balancing profit with societal benefits. However, Musk has criticized the move, accusing Altman and Microsoft of diverging from OpenAI’s original mission. In November, Musk filed multiple lawsuits to block the transition, citing concerns about governance and potential conflicts of interest.
The Financial Times reports that OpenAI’s non-profit stake in the proposed PBC could be worth tens of billions of dollars. Musk’s push for an auction could allow outside investors to gain significant control over the company. OpenAI has countered, asserting that its PBC conversion will benefit charitable initiatives while providing substantial returns for early backers, including Musk.
