Judge denies Elon Musk’s request to block OpenAI for-profit conversion but welcomes trial

OAKLAND, Calif. (news agencies) — A federal judge has denied Elon Musk’s request for a court order blocking OpenAI from converting itself to a for-profit company but said she could expedite a trial to consider Musk’s claims against the ChatGPT maker and its CEO.

U.S. District Judge Yvonne Gonzalez Rogers ruled late Tuesday that “Musk has not demonstrated likelihood of success on the merits” in his request for a preliminary injunction. She offered to hold a trial in her California courtroom as soon as this fall, “given the public interest at stake and potential for harm if a conversion contrary to law occurred.”

Musk, an early OpenAI investor, began a legal offensive against the ChatGPT maker and CEO Sam Altman a year ago, suing for breach of contract over what he said was the betrayal of its founding aims as a nonprofit.

He escalated the legal dispute late last year, adding new claims and defendants, including Microsoft, and asking for a court order that would stop OpenAI’s plans to convert itself into a for-profit business. Musk also added his own AI company, xAI, as a plaintiff, claiming that OpenAI was unfairly stifling business competition.

He and a group of investors more recently made an unsolicited $97.4 billion bid to buy a controlling stake in the nonprofit — a move that undermined Musk’s “claim of irreparable harm,” the judge wrote.

OpenAI said it welcomed the court’s decision.

“This has always been about competition,” a statement from the company said. “Elon’s own emails show that he wanted to merge a for-profit OpenAI into Tesla. That would have been great for his personal benefit, but not for our mission or U.S. interests.”

Musk alleges in the lawsuit that the companies are violating the terms of his foundational contributions to the charity. He had invested about $45 million in the startup from its founding until 2018, his lawyer has said.