Musk filed a lawsuit in San Francisco Superior Court against OpenAI CEO Sam Altman, OpenAI co-founder and president Greg Brockman, and various OpenAI entities for breach of contract. The list of defendants, however, does not feature OpenAI co-founder and chief scientist Ilya Sutskever, who is suspected to have left OpenAl.
Not long after handing over the indictment, Musk took to the social media platform X to space out his provocations, while @OpenAI and Figure AI, the humanoid robotics unicorn that has just been officially announced as an investment by OpenAI, declared open war:
“Come here!”
In 2015, Musk, Altman and others co-founded the nonprofit organization OpenAI, which Musk later left in 2018 because of a conflict of interest with Tesla, which was developing self-driving AI. Over the years, Musk has been resentful of OpenAI’s shift to commercial profitability and closed-source models, often expressing his dissatisfaction on social platforms and sneering at OpenAI’s collaboration with Microsoft.
Musk’s demands in this lawsuit include three points – compensation, open source, and restoration of non-profit nature: 1) he has been cheated by OpenAI in terms of money, people, and technology, and demands that OpenAI pay back the money and compensate for his own damages; 2) he demands that OpenAI restore open source; and 3) he wants to prevent OpenAI and Microsoft from profiting from the AGI (Generalized Artificial Intelligence) technology. Artificial Intelligence (AGI) technology, trying to cut off OpenAI and Microsoft’s “financial road”.
In this sprawling 46-page, 14,000-word lawsuit, Musk denounced OpenAI against the original intent, mentioned some OpenAI had unknown insider details, questioned Altman and others to “enrich themselves”, and cited OpenAI five major “sins “The lawsuit page shows that the trial of the lawsuit is in progress.
The lawsuit page shows that the trial process is scheduled for July 31, 2024 to hold a case management meeting, it seems that the drama will not end soon.
Litigation Documents:
https://www.courthousenews.com/wp-content/uploads/2024/02/musk-v-altman-openai-complaint-sf.pdf
Five reasons to sue OpenAI for cheating money, people and technology?
Musk listed five reasons, summarized, in fact, are saying one thing – OpenAI violated the original founding agreement, “cheating” Musk’s financial resources, energy and technology.
He claimed that OpenAI “induced” him to make donations and resources by promising that it “will be a non-profit organization dedicated to the development of AGI for the benefit of mankind” and that it “will keep its technology open source and will not close it for commercial reasons”. donations and resources, including tens of millions of dollars in funding, key advice on research directions, and assistance in recruiting world-class talent.”
The lawsuit filings mention several times that Musk will prove the amount of his damages at trial, if necessary. That amount is unknown at this time, but it certainly exceeds the court’s jurisdictional minimum of $35,000.
The specific causes of action are the following 5 points:
Breach of Contract (Breach of Contract)
Musk claims that from 2015 until September 2020, he not only contributed tens of millions of dollars in funding, provided key advice on research direction, and played a key role in recruiting world-class, talented people, and that these contributions were considered based on OpenAI’s founding agreements.
These agreements include, but are not limited to, that OpenAI will develop AGI for the benefit of humanity as a non-profit organization, will keep the technology open source, and will not be closed for commercial reasons.
In the attachment, Musk provided a screenshot of Altman’s written correspondence with him in 2015. Altman wrote, “[The organization’s] mission will be to create the first AGI and use it for personal empowerment …… The technology will be owned by the Foundation and will ‘benefit the world’.”
According to Musk, OpenAI violated the agreement in a number of ways, including exclusively licensing GPT-4 to Microsoft, failing to disclose information about GPT-4’s architecture, hardware, and training methods to the public, erecting a “paywall” for the use of GPT-4, and allowing Microsoft to take a seat on OpenAI’s board of directors. A seat on the OpenAI Board of Directors.
Promissory Estoppel (Promissory Estoppel)
Musk argues that Altman “induced” him to make donations and commit resources by promising that OpenAI would develop AGI as a non-profit organization.
He claims that he made investments based on these promises, but that OpenAI later abandoned its nonprofit mission, contrary to the promises made to him.
Breach of Fiduciary Duty
Under California law, Defendants owe a fiduciary duty to Plaintiffs, which includes using Plaintiffs’ donations for the agreed-upon purpose. Musk alleges that OpenAI breached its agreement with him and its promises to the public by using the funds for for-profit purposes.
Unfair Business Practices (UBP)
Musk alleges that OpenAI engaged in unfair competition and other unfair business practices when it falsely advertised at the time of its fundraising that all funds would be used for the basic purposes set forth in the founding agreement. If he had known this, he never would have donated to OpenAI.
Accounting and Auditing (Accounting)
As noted above, Musk contends that OpenAI has used the funds it received from him, as well as the intellectual property and derivative works funded by those funds, for “for-profit” purposes in direct violation of the letter and express intent of the parties’ agreement. The suit calls for an audit of OpenAI’s financial information, as he is unable to ascertain the use and distribution of his interests or assets, which the latter has in its possession.
Musk’s demands: spit out all the money he made, give back all the money he spent, and keep it open
So what does Musk ultimately want the court to decide about OpenAI? He listed a total of 10 major items and 11 minor items.
Overall, Musk wants OpenAI to return to opening up AI technology to the public, i.e. moving from today’s closed source to open source. At the same time, he believes that the AI big model technology currently developed by OpenAI is effectively AGI, and that OpenAI’s license to Microsoft excludes AGI.
With regard to compensation, his overall demand is for OpenAI to return all the money earned during the breach of contract, and he also wants to conduct an inventory of OpenAI’s use of the donated money, which Musk seems to suspect that they are “enriching themselves” with.
Of course, Musk even all kinds of interest and attorney’s fees are clearly calculated, can be said to be OpenAI and Altman to a thorough “liquidation”.
OpenAI Breaks Founding Agreement to Become “Microsoft’s Closed-Source Subsidiary”
The lawsuit states that OpenAI was founded with the goal of developing AGI for the benefit of humanity, not for the benefit of itself or the world’s largest technology companies.
According to pages 3 to 27 of the lawsuit, OpenAI’s initial research was open and accessible for free, causing a huge response from the entire community. When researchers realized that the Transformer algorithm invented by Google had great potential, the community quickly began to enhance and extend these models.
Initially the collaboration between OpenAI and Microsoft wasn’t a problem either. Altman became CEO of OpenAI in 2019. in September 2020, the company reached an agreement with Microsoft to license its GPT-3 language model. However, OpenAI released a detailed paper on GPT-3 and reserved the right for the nonprofit’s board of directors to decide what AGI reached, and Microsoft did not acquire any rights to AGI.
How did OpenAI go against its mission of developing AGI for the benefit of humanity?
According to the lawsuit, in 2023, OpenAI’s founding agreement was set to reflect the spirit of the consensus reached by Altman, Musk, and Brockman: (a) to act as a nonprofit focused on developing AGI for the benefit of humankind rather than a for-profit corporation seeking to maximize shareholder profits, and (b) to adopt an open-source model that balances benefits only with security in mind, and not to close or keep its technology secret for proprietary commercial reasons to close or keep its technology secret.
Altman, however, immediately took OpenAI completely away from its original mission. They introduced GPT-4, a powerful language model that, while designed to benefit the public by preserving the contributions of the plaintiffs and others, is now effectively part of Microsoft, integrated into the Office software suite.
In terms of communication concepts, GPT-4 is considered an AGI algorithm, which is beyond the scope of Microsoft’s September 2020 exclusive license with OpenAI. Microsoft researchers have said that GPT-4 could be considered a version of earlier AGI systems given its capabilities. According to media reports, OpenAI is currently developing a more powerful AGI model known as “Q*,” which also poses a challenge to Microsoft’s exclusive license scope.
The OpenAI coup brought this conflict to the forefront when, in November 2023, OpenAI’s board of directors fired Altmann, accusing him of lacking integrity with the board, but then immediately reappointed him as CEO. It is believed that Altman was fired in part because of OpenAI’s breakthrough in achieving AGI. According to news reports, there were disagreements between OpenAI board members and executives over security issues and the potential threat OpenAI’s next-generation Q* could pose.
Following the coup, the new board members were seen as lacking substantial AI expertise to independently judge whether OpenAI had achieved AGI and the challenges it faced in terms of technology and corporate governance.
Altman almost disguised an admission that the company’s technology could be fully transferred to Microsoft. The lawsuit filing notes that Altman said in an interview shortly after his firing, “We’re very confident in our abilities. We have all the intellectual property and all the capabilities. If OpenAI disappears tomorrow, I really don’t want any of our customers to be worried because we have all the rights to continue to innovate. Not just to deliver products, but we can continue what we’ve done in our collaborations. We have the talent, we have the computing power, we have the data, we have everything.”
The lawsuit states that these events are a clear violation of OpenAI’s founding agreement and are essentially subversive. While the company’s website still claims that its goal is to ensure that AGI benefits all of humanity, in reality, OpenAI has become a de facto closed-source subsidiary of Microsoft.
Under its new board of directors, OpenAI is not only developing AGI, but refining the technology to maximize Microsoft’s profits, not for the benefit of humanity. The company’s technology, including GPT-4, is largely closed and serves primarily Microsoft’s commercial interests.
Conclusion: can a lawsuit reveal the secrets behind OpenAI?
Musk and OpenAI have a long history, almost OpenAI and Microsoft have a big action, Musk will be cynical on social platforms, At the beginning of this year OpenAI’s AI-generated video model Sora was released, Musk retweeted a few tweets one after another when OpenAI was first established, pointing out that OpenAI’s nonprofit nature has changed qualitatively.
With the ChatGPT chatbot becoming famous in one battle, OpenAI has been at the tip of the global technology industry, and its every move touches the eyes of people from all walks of life, and the balance between AI security and the rapid development of technology has also become the focus of discussion.
From the lawsuit, we can also see that Musk’s reason for suing is also for AI security concerns, but behind the scenes whether there is OpenAI and Microsoft’s money-sucking body red, we can not presume to speculate.
Musk’s lawsuit filing also mentions some once-unknown details related to OpenAI: such as the fact that the new board members were hand-picked by Altman; that Brockman was previously the first to propose the creation of a for-profit subsidiary, but Musk vetoed him; and that Helen Toner, the OpenAI board member who was exposed as being the key to Altman’s dismissal, was threatened with a breach of fiduciary obligations, even though the board had made it clear that there was no such risk.
However, Musk’s lawsuit request also mentions the many mysteries that still linger around OpenAI, and this public lawsuit may force OpenAI to reveal the real answers behind the previous Altman power grab drama, the mysterious Q project, and more.
With Musk and OpenAI this “love-hate” entanglement drama really to the court, perhaps shortly the dust will settle, look forward to the follow-up development, and move a small bench to sit and wait to eat melon.
