Elon Musk sues OpenAI and loses! $150 billion lawsuit dismissed; the key to losing was the "timing of the lawsuit"

Musk sues OpenAI over claims that the case was brought beyond the statutory statute of limitations, and the court dismissed it in full. The ruling helps resolve legal risks from commercialization and removes obstacles for future listing plans.

OpenAI wins as Musk’s lawsuit is dismissed in full
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According to a report by NBC, there has been a major development in the two-year legal battle between Elon Musk and OpenAI. On May 18, a federal jury in California ruled that Musk’s multiple claims against OpenAI, Sam Altman, Greg Brockman, and Microsoft are barred due to exceeding the statute of limitations, effectively declaring that the case—worth as much as $150 billion—has completely failed.

The case was heard in the Northern District of California federal court. The jury took less than two hours to deliver its verdict. Judge Yvonne Gonzalez Rogers then accepted the jury’s findings and held that OpenAI and the related defendants do not need to bear legal responsibility, while dismissing Musk’s claims including “breach of charitable trust” and “unjust enrichment.”

Musk filed the lawsuit in 2024. His core argument is that OpenAI deviated from its original nonprofit mission when it was established in 2015 and gradually shifted toward commercialization after Microsoft made substantial investments. He argued that OpenAI was originally supposed to pursue a “benefit to humanity” goal, avoiding the complete dominance of commercial interests in AI development.

* Related news: The first day of the Musk–Altman lawsuit hearing: a roundup of both sides’ statements and lawyers’ arguments—understand the power struggle over OpenAI

The court finds Musk filed the suit too late
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In court, OpenAI lawyer Bill Savitt pointed out that Musk had long been aware of changes in OpenAI’s organizational structure and adjustments to its business model, yet delayed for years before filing the lawsuit. The court ultimately accepted this argument, finding that the relevant requests were beyond the statute of limitations under California law.



Image source: Reuters The court ruled against Musk

Under California law, the statute of limitations for lawsuits involving charitable trusts is 3 years, while for unjust enrichment it is 2 years. The jury believed that Musk knew early on that OpenAI was gradually shifting to a for-profit model, so he could not reassert related rights after many years.

Musk’s team countered that the core issue was not timing, but whether OpenAI violated the commitments it made at the beginning. Musk said in court that he had always believed Sam Altman’s statements about OpenAI’s vision, and only in the later stages did he realize that the entire organization had completely changed direction.

However, the court also stated that Musk’s team was unable to present legally valid formal documents proving that OpenAI must never transition to a for-profit structure. The entire trial ultimately relied heavily on early emails, records of conversations, and oral discussions among the founders.

Obstacles on OpenAI’s path to commercialization removed
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According to the lawsuit, Musk’s team had asked the court to carry out a major reorganization of OpenAI, including replacing Sam Altman, overturning OpenAI’s commercialization framework in recent years, and even demanding that Microsoft return the substantial benefits it obtained through its cooperation with OpenAI.

OpenAI’s lawyers emphasized that large AI models require massive computing power, chips, and funding support, and without a commercialization framework it would be difficult to compete with rivals such as Google DeepMind. OpenAI also mentioned that Musk had previously discussed for-profit models and even hoped that Tesla would lead OpenAI’s development.



Image source: The Information OpenAI CEO Sam Altman

The outcome of this ruling is also widely viewed as a major win for OpenAI’s commercialization efforts. Because Musk’s lawsuit could have created significant uncertainty for OpenAI’s future IPO, financing, and partnership with Microsoft, the court’s decision has clearly reduced related legal risks.

At present, OpenAI’s market valuation is approaching $850 billion. It continues to compete in the AI arena with Anthropic, Google DeepMind, and xAI. Many believe that if OpenAI successfully goes public in the future, it could become one of the largest-scale technology IPOs globally in recent years.

Conflict between Musk and OpenAI will continue
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Although this lawsuit outcome is a major setback for Musk, the conflict between the two sides has not fully ended. Musk’s lawyer Steven Molo has said he will file an appeal, arguing that the court’s ruling mainly concerns procedural issues rather than the merits of the case itself.

Currently, multiple legal cases between Musk and OpenAI are still ongoing, including OpenAI’s counterclaims alleging that Musk used a malicious litigation strategy, as well as xAI’s antitrust lawsuit against OpenAI and Apple.

As xAI continues to advance the Grok model, competition between Musk and OpenAI is gradually shifting from the courtroom back to the AI market itself. Especially once AI models begin to affect the markets for search, social media, finance, and enterprise software, this conflict has increasingly evolved into a global struggle over who will dominate AI.