OpenAI countersues Elon Musk over ‘press attacks, malicious campaigns’

OpenAI has launched a countersuit against Elon Musk, accusing him of waging a “malicious” and sustained campaign to undermine the company he helped found a decade ago. The lawsuit, filed in a federal court in California, is the latest twist in a high-stakes dispute over the future of one of the world’s most influential artificial intelligence (AI) firms.

In court documents filed on Wednesday, OpenAI alleged that Musk – who co-founded the company in 2015 but left before it became a household name – has used his social media platform X, legal threats, and even a failed takeover attempt to disrupt its work and stall its transition to a for-profit model.

The company has asked the judge to block what it described as Musk’s “unlawful and unfair” interference and to hold him accountable for “the damage he has already caused.”

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A billionaire feud over AI’s future

Musk, who went on to found his own AI company xAI in 2023, has been a vocal critic of OpenAI’s current direction. He sued the company and its CEO Sam Altman last year, accusing them of abandoning its original nonprofit mission of developing AI “for the benefit of humanity”. Instead, he claimed, OpenAI had become overly focused on commercial gain – a shift that Musk believes runs counter to the ethos upon which the company was built.

But OpenAI’s leadership sees Musk’s actions differently. In its countersuit, the company pointed to what it described as a pattern of “harassing legal claims”, “press attacks”, and a “sham bid” to acquire its assets. “Through press attacks, malicious campaigns broadcast to Musk’s more than 200 million followers on the social media platform he controls… Musk has tried every tool available to harm OpenAI,” the company wrote in its filing.

These moves, the firm says, are part of a broader effort by Musk to either slow the company down or gain control of its technology for his own business interests.

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The filing referenced a $97.4 billion unsolicited takeover offer earlier this year from a consortium led by Musk – a bid that OpenAI rejected. In response, Musk’s lawyer, Marc Toberoff, said the board had failed in its duty to seriously consider the offer. “It’s telling that having to pay fair market value for OpenAI’s assets allegedly ‘interferes’ with their business plans,” Toberoff said in a statement.

Stakes rising in Silicon Valley’s AI arms race

The legal wrangling comes as OpenAI races to complete its transition to a “capped-profit” model – a structure designed to attract commercial investment while limiting the financial return of shareholders. The move is crucial for securing up to $40 billion in new funding, a sum that would put OpenAI in pole position in the increasingly costly global AI race.

OpenAI has said it must finalise its new structure by the end of 2025 to unlock the full value of its current fundraising round. But it claims Musk is trying to derail that process, and it has now asked the court to prevent any further interference from him.

The countersuit adds a new layer of tension to a case already slated to go before a jury next spring.

However, OpenAI posted a sharp rebuke on X, the platform Musk owns: “Elon’s nonstop actions against us are just bad-faith tactics to slow down OpenAI and seize control of the leading AI innovations for his personal benefit.”