Elon Musk just filed a lawsuit against OpenAI and Microsoft. He is looking for damages between $79 billion and $134 billion, alleging that OpenAI defrauded him when it deviated from its stated nonprofit mission. We expect this case will be heard in Oakland, California. It has garnered the most interest because of the fact that Musk is seeking a record high in compensation, and he happens to be the world’s richest man.
Musk co-founded OpenAI in 2015. He argues that his starting investment of $38 million entitles him to a large share in OpenAI’s current estimated value of about $500 billion. From left to right, C. Paul Wazzan, expert witness and seasoned financial economist. Aside from his clear command of commercial litigation, he has supplied the financial underpinnings of Musk’s claim. Wazzan’s analysis indicates that Musk’s investment could return as much as 3,500 times its initial value.
Those legal proceedings arrive at a moment when Musk’s personal wealth is estimated at $700 billion. At heart, Musk’s legal team is claiming that Musk should be compensated as an early stage startup investor would be. They think that’s fair because of the unprecedented change that OpenAI has undergone since its inception. They maintain that the company’s departure from its founding vision has led to disastrous financial consequences for Musk.
In response to the lawsuit, OpenAI has sent a letter to investors and business partners, cautioning them about what they describe as “deliberately outlandish, attention-grabbing claims” made by Musk. The company, which has raised $170 million in funding so far—including a $27 million investment from Microsoft—claims that Musk’s claims are without merit.
And just this week, Tesla shareholders approved a $1 trillion pay package for Musk, cementing his influence as the dominant player in the tech industry. Regardless, this lawsuit against OpenAI and Microsoft is likely to drive most news to come, especially in the leadup to trial set for next April.
As the case proceeds, millions of people will be watching the courts with bated breath. They’re eager to see how the judges read Musk’s ownership of OpenAI and what that means for DeepMind and OpenAI going forward.