Elon Musk Lawsuit Claims OpenAI Betrayed Its Mission, Raising Fears for AI Trust

Elon Musk's legal battle with OpenAI is set to enter a decisive new phase after a US judge ruled that the case should be heard by a jury in March, marking a major escalation in one of Silicon Valley's most closely watched disputes.

What began as a philosophical disagreement over the purpose of artificial intelligence has hardened into a courtroom confrontation over contracts, control and billions of dollars in value.

At the heart of the case is Musk's claim that OpenAI, the organisation he helped found in 2015, abandoned its original nonprofit mission in favour of commercial gain. The billionaire argues that assurances given in OpenAI's early years were later broken, leaving him sidelined as the company pursued profit-driven growth and partnerships.

Read More: Elon Musk's AI War With OpenAI Explained As Rift Intensifies, Lands In Court

Read More: Google Surges to Nearly $4 Trillion, Overtakes Apple for First Time as AI Threatens OpenAI and NVIDIA

The ruling ensures that a jury will now weigh those claims, setting up a trial that could expose internal communications from OpenAI's formative years and reshape the debate over the governance of artificial intelligence. The dispute also reflects a broader pattern in the tech industry, where early ideals often collide with the realities of scale, funding and competition.

From Nonprofit Ideal To Courtroom Battle

Musk sued OpenAI and its senior leadership in 2024, alleging that the organisation's shift towards a for-profit structure violated its founding principles. He was an early financial backer, investing about $38.00 million (£31.40 million), and says he also provided credibility and strategic guidance on the understanding that OpenAI would prioritise public benefit over shareholder returns.

OpenAI was established as a nonprofit research lab but began restructuring in 2019, creating a for-profit subsidiary with a capped-profit model to attract investment and talent. In October 2025, the company completed a further overhaul, turning the commercial arm into a Public Benefit Corporation while the original nonprofit retained a 26 per cent equity stake.

Musk, who left OpenAI's board in 2018 after failing to secure the chief executive role, argues that these changes represent 'ill-gotten gains'. OpenAI has rejected that characterisation, with a spokesperson describing the lawsuit as 'baseless and a part of his ongoing pattern of harassment.'

Judge Clears The Way For A Jury Trial

The decision by District Judge Yvonne Gonzalez Rogers hinged on evidence suggesting that OpenAI's leaders may have made assurances about preserving the nonprofit structure, as Musk alleges. That threshold was enough to send the case to a jury, with a trial tentatively scheduled for March, reports TechCrunch (via Yahoo!).

The ruling comes against the backdrop of a deepening rivalry between Musk's AI venture xAI and OpenAI. Earlier in 2025, a Musk-led group made an unsolicited $97.40 billion (£80.20 billion) bid to acquire OpenAI, which was swiftly rejected by the board.

Separately, xAI has accused OpenAI of poaching staff and misappropriating trade secrets, claims that OpenAI has strongly denied.

For OpenAI, the prospect of a jury trial raises reputational as well as financial risks. For Musk, it offers a public forum to argue that the company he helped create strayed from its founding vision.

A Familiar Tech Saga Of Leaks And Timing

The case also highlights how long-running disputes can simmer quietly before erupting into public view. Legal filings and internal tensions dating back more than two years are only now emerging in full, much as high-profile leaks in the games industry surfaced well before Rockstar publicly revealed plot details about its next blockbuster title.

In both cases, early disclosures shaped public perception long before official narratives were ready.

As the March trial approaches, the jury will be asked to look beyond today's AI boom and examine promises made a decade ago. The outcome could have lasting implications not just for Musk and OpenAI, but for how mission-driven tech organisations balance ideals with commercial ambition.