OpenAI announced in December 2024 its plans to evolve into a Delaware Public Benefit Corporation (PBC) to better align its mission with ensuring that artificial general intelligence benefits all of humanity.
Musk has also requested a preliminary injunction to halt OpenAI's transition to a for-profit entity, although the judge has yet to rule on this request.
Recent reports suggest that SoftBank may lead a new funding round for OpenAI, potentially raising up to $40 billion and valuing the company at $300 billion.
The conversion of nonprofit organizations to for-profit status is unusual, primarily seen in sectors like healthcare, according to experts.
Elon Musk has filed a lawsuit challenging OpenAI's transition from a nonprofit to a for-profit model, arguing that this shift contradicts the organization's original mission of developing AI for the benefit of humanity.
Musk's lawsuit claims that the founders of OpenAI intended to focus on nonprofit AI development, but have since prioritized profit-making.
In defense of the transition, OpenAI asserts that moving to a for-profit structure is essential for securing the necessary funding for AI development.
This restructuring is critical for OpenAI's fundraising efforts, which include a recent $6.6 billion round and discussions for a potential $25 billion round with SoftBank.
Musk co-founded OpenAI in 2015 alongside CEO Sam Altman but departed before its success, later establishing the competing AI startup xAI in 2023.
In response to Musk's claims, OpenAI plans to dismiss the lawsuit and argues that Musk should be competing in the market rather than pursuing legal action.
Judge Rogers indicated that Musk's legal team may need to present more evidence for the injunction, suggesting the possibility of an evidentiary hearing.
On February 4, 2025, U.S. District Judge Yvonne Gonzalez Rogers ruled that parts of Musk's lawsuit will proceed to trial, requiring him to testify, with a jury ultimately deciding the case's outcome.
