Elon Musk testified he felt “betrayed” after funding OpenAI, alleging leaders shifted toward profit and could disrupt its future.
Elon Musk took the stand in U.S. federal court and told the jury he once funded OpenAI while believing assurances would keep it a nonprofit.
His testimony. delivered during a trial he brought against OpenAI. zeroed in on a promise Musk says was central to the company’s origin: that OpenAI would prioritize human benefit over profit.. Musk framed his decision-making as a series of shifting expectations—excitement at the early mission. then growing doubts about direction. and finally a sense of betrayal.
The case is being heard in the U.S.. District Court for the Northern District of California and is expected to last about four weeks.. At its core is a civil lawsuit alleging OpenAI’s leadership reneged on the founding agreement.. Musk’s legal aim includes seeking to remove OpenAI CEO Sam Altman from the board.. He also argues the nonprofit mission has been undermined as the company expanded rapidly.
Musk said he contributed $38 million to OpenAI between December 2015 and May 2017.. He described continuing to fund the company after receiving assurances from Altman that OpenAI would remain a nonprofit.. As the organization grew. however. Musk said he began questioning what the promises meant in practice and whether the leadership’s priorities aligned with the original intent.
That narrative is facing a direct challenge from OpenAI’s lawyers. who argue Musk’s allegations rest on an inaccurate reading of what was promised.. OpenAI’s position is that company leaders did not agree to keep OpenAI as a nonprofit forever.. The company has also pushed the idea that Musk’s lawsuit may be motivated by competition—pointing to Musk’s own AI startup. xAI. launched in 2023.
During cross-examination. Musk clashed with questioning that probed early email discussions about the structure of OpenAI before it was founded. including whether the model should be for-profit and how tax deductions might have applied to donations.. When attorneys asked questions that touched on the ambiguity of those early planning steps. Musk pushed back sharply. saying the questions were designed to “trick” him.
The courtroom moments were not all tense.. At one point. a judge stepped in to ask Musk to answer whether it was true or false that OpenAI was formed as a nonprofit in December 2015.. Musk said the answer was yes. while adding that the situation was more complicated than a straightforward label—then likened it to a similarly reductive question.. The judge responded with a boundary on further comparison, and the exchange drew laughter.
At a higher level, the trial is about more than personal blame.. It is a fight over governance. intent. and whether a mission can remain stable as an AI company scales into the mainstream.. If Musk’s claims succeed, the consequences could extend beyond board access.. The trial could also affect OpenAI’s strategic runway, including plans related to an initial public offering.
From a technology and market standpoint. this dispute lands in a moment when AI companies are being pulled between competing pressures: attracting capital. scaling research. managing compute costs. and delivering products—while also maintaining a public narrative of human-oriented progress.. The nonprofit framing. in particular. functions like a trust signal for supporters who worry that rapid commercialization will turn innovation into a race for profit.
Musk’s testimony also revealed how his relationship with OpenAI evolved.. He described what he called three phases—moving from interest to losing confidence. then returning to the idea that OpenAI was betraying its promise in late 2022.. He told the court he initially sought majority influence and board control. then said dilution would occur as the company gained new shareholders.. OpenAI disputes that there were assurances Musk would eventually relinquish board majority control.
Why it matters now is simple: the governance model of leading AI labs doesn’t just shape internal decisions. it shapes how the public interprets the stakes of AI deployment.. For investors and partners, the structure affects risk and predictability.. For users, it affects trust—especially when systems influence everyday life, from information access to hiring, education, and commerce.
If the court focuses on what was promised versus what was understood. the outcome could set a precedent for how future AI ventures document their mission commitments.. And if OpenAI’s direction is judged through the lens of nonprofit expectations. the debate will likely move beyond this courtroom into policy. fundraising norms. and how AI “purpose” is legally defined.
For now, Musk’s “fool” remark—used to describe his willingness to fund OpenAI under the belief that the nonprofit mission would hold—has turned a business disagreement into a question with real governance consequences for one of the industry’s most influential AI developers.