Day 2 of testimony (Day 3 of trial) in the high-profile trial in Elon Musk’s lawsuit against OpenAI CEO Sam Altman has concluded. Musk returned to the witness stand to continue telling his side of the story. Steven Molo, Musk’s lawyer, began the proceedings on Wednesday by questioning Musk about his understanding of OpenAI’s structure and his relationships with its executives. After that, OpenAI’s attorney, William Savitt, started cross-examining Musk but did not finish, meaning Musk will return to the stand on Thursday.
Musk said OpenAI changed after he left in early 2018, though he continued to donate money and stayed updated. He knew Sam Altman was trying to create a for-profit arm and raise money from Microsoft, but since profits for investors were capped, he did not see it as a big issue.
However, Musk said he grew concerned in early 2023 when Microsoft invested $10 billion, after ChatGPT became hugely popular. He said he texted Altman, asking, “What the hell is going on?” and called it a “bait and switch.”
“They had essentially turned the nonprofit into a company valued at $20 billion,” he said.
After the investment, Musk said OpenAI offered him equity, but he refused.
“Frankly, it felt like a bribe,” he said.
Cross-examination turns tense
During cross-examination, OpenAI’s lawyer William Savitt questioned Musk’s claims, pointing out a contradiction: Musk said in court he donated $38 million, but earlier in a deposition, he had said $100 million.
The exchange became tense. Musk accused the lawyer of asking tricky questions. At one point, he argued that yes-or-no questions are not always simple. He said, “The classic answer to a yes-or-no question is not so simple. For example, if you ask the question, ‘Will you stop beating your wife?’”
The judge, Yvonne Gonzales Rogers, quickly interrupted and stopped him.
Emails and funding dispute
Savitt showed emails from September 2017 between Musk, Sam Altman, Greg Brockman, and Ilya Sutskever about creating what later became OpenAI’s for-profit arm.
Since 2016, Musk had been sending $5 million every quarter as part of a $1 billion pledge, but he stopped in spring 2017. In an August 2017 email, his aide Jared Birchall asked if he should continue holding the money, and Musk replied, “Yes.”
In October 2017, after losing a power struggle, Musk discussed hiring OpenAI employees with Tesla and Neuralink executives, even though he was still on OpenAI’s board. When questioned, Musk said it would have been illegal to stop those companies from hiring OpenAI staff.
“It’s illegal to restrict employment. It would be illegal to say you can’t employ people from OpenAI. You can’t have some cabal that stops people from working at the company they want to work at,” Musk said.
Savitt also showed a 2018 email from Shivon Zilis, a longtime Musk associate, mother of his four children and former OpenAI board member, asking if she should stay close to OpenAI and keep him informed. Musk told her to stay “close and friendly.”
Background and legal arguments
Earlier in the trial on Tuesday, Musk’s lawyer said Musk had long been worried about AI becoming more powerful than humans and had pushed for regulation, but saw little action. Around that time, Musk and Altman decided to start OpenAI as a nonprofit.
As OpenAI grew, they later agreed to create a limited for-profit arm to raise funds. But Musk felt things went too far after Microsoft invested $10 billion in 2023.
OpenAI’s lawyer, William Savitt, argued that the company never promised to remain a nonprofit or make all its code public, and said Musk’s claims lack evidence. He also said Musk did not fully meet his own commitment, contributing about $38 million instead of the promised $1 billion.
What’s at stake
In his lawsuit, Musk claims Altman and Brockman abandoned OpenAI’s original nonprofit mission. The trial could impact OpenAI’s structure, funding, and partnership with Microsoft. It began Monday with jury selection, and Musk testified as the first witness on Tuesday.
