Microsoft-backed OpenAI faces lawsuit from Elon Musk – again: report

Microsoft-backed (NASDAQ:MSFT) OpenAI faces a new lawsuit from Elon Musk, a co-founder of the ChatGPT creator, less than two months after Musk dropped a similar lawsuit against the AI startup, according to a report.

Musk filed the suit in a federal district court in Northern California, on Monday, according to a report by The New York Times. It alleges OpenAI co-founders Sam Altman and Greg Brockman reneged on their promise to open source its technology, instead giving Microsoft an exclusive license. It also claims OpenAI violated federal racketeering laws.

The new suit appears similar to a suit Musk dropped on June 11, one day before the judge was to rule on a motion to dismiss the trial.

Musk filed that lawsuit in March, claiming OpenAI had abandoned its original mission, and chosen profits over benefitting humanity, due to its partnership with Microsoft.

“The previous suit lacked teeth — and I don’t believe in the tooth fairy,” Musk’s lawyer Marc Toberoff told The New York Times.

It also alleges Microsoft has a contract with OpenAI which specifies Microsoft would no longer have rights to OpenAI’s technology once it achieves artificial general intelligence, or AGI. Once the technology becomes as intellectually capable as a human being, it is considered AGI. The lawsuit wants the court to determine if OpenAI has achieved AGI.

Musk has his own generative AI startup, xAI, which competes with OpenAI’s ChatGPT and other large language models.