TECH NEWS – And in 2017, he supported something he’s now suing OpenAI for. He’s what they call a villain!
The story between OpenAI and Elon Musk is a messy one, and now it has taken an unexpected turn as the company behind ChatGPT has released a series of messages and emails saying that Elon Musk, the owner of Tesla, SpaceX and Twitter, wanted the AI company to stop being a non-profit. Now he has filed a lawsuit against the company for that very reason! OpenAI was founded as a non-profit AI research organization in December 2015, nine years ago, and in 2019 it launched a for-profit subsidiary (OpenAI Global). The company was co-chaired by Sam Altman and Musk until 2018, when the latter resigned from the board because his position would have been a conflict of interest with Tesla, which uses AI for its self-driving car systems.
Over the years, a number of people have left OpenAI to start their own AI companies, and OpenAI Global caught the attention of Microsoft. After investing billions of dollars, Redmond owns nearly half of the company. But this year, Musk sued Altman and OpenAI for breach of contract, breach of fiduciary duty, and unfair business practices. In other words, because OpenAI chose to pursue profit and commercial interests rather than the company’s original purpose of artificial intelligence for the benefit of humanity. But it’s not that simple. According to published messages and emails, Musk wanted OpenAI to become a for-profit company in the summer of 2017, and then “demanded a majority stake, absolute control, and that he be the CEO of the for-profit company.”
An email purportedly from Musk states, “The Preferred A round of investment (supermajority me) should have the right to appoint four (not three) seats. I would not expect to appoint them immediately, but as I said, I would clearly have initial control of the company, but that will change quickly”. This was rejected by the board: “We really want to work with you. We believe that our chance of success in the mission is greatest if we join forces. Our upside is the highest. There is no doubt about that. Our desire to work with you is so great that we are happy to give up equity, personal control, make ourselves easily fireable – whatever it takes to work with you.”
Musk’s response was unanimous: “Guys, I’ve had enough. This is the last straw. Either do something on your own or continue with OpenAI as a non-profit. I will no longer fund OpenAI until you make a firm commitment to stay, or I’m just a fool for essentially giving you free money to start a startup. Discussions are over.” Musk has never been a big opponent of opening a for-profit subsidiary, or even necessarily of the entire company going that route. The question seems to be how it would be organized and financed. Which makes the current lawsuit seem a bit odd: why is there a problem with the for-profit OpenAI now?
