Elon Musk drops fraud claims against OpenAI ahead of trial

Elon Musk has dropped fraud-related claims against OpenAI and its co-founders Sam Altman and Greg Brockman, significantly narrowing the scope of his lawsuit just ahead of a scheduled trial in California.

A US district judge in Oakland approved Musk’s request to streamline the case, reducing the original 26 claims in his November 2024 complaint to just two: unjust enrichment and breach of charitable trust. Jury selection is set to begin on Monday.

The lawsuit alleges that OpenAI abandoned its founding mission as a nonprofit focused on benefiting humanity after securing major investment from Microsoft and moving toward a for-profit structure.

Musk argues this shift represents a departure from the organisation’s original purpose.

OpenAI, along with Altman, Brockman, and Microsoft, has denied all allegations, calling Musk’s claims baseless and characterising the lawsuit as harassment.

The company previously accused Musk of launching a “legal ambush” shortly before trial proceedings.

The upcoming trial will proceed in two stages. In the first phase, a jury will hear arguments and provide an advisory verdict, which will not be binding.

The final decision will rest with the judge overseeing the case. A second phase will focus on potential remedies and legal outcomes.

Musk co-founded OpenAI in 2015 alongside Altman and others but left the board in 2018.

Since then, he has become a prominent critic of the company and later launched his own AI venture, xAI, which competes directly in the rapidly growing AI sector.

The legal dispute comes amid broader tensions in the tech industry over AI development, funding structures, and the commercialisation of advanced models.