Musk loses to OpenAI! A $150 billion lawsuit was dismissed, and the key to the defeat was the “time of filing the lawsuit”

Elon Musk's lawsuit against OpenAI was fully dismissed by the court due to exceeding the statute of limitations. This ruling resolves legal risks related to commercialization and clears obstacles for future IPO plans.

OpenAI wins, Musk's lawsuit fully dismissed by the court
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According to NBC reports, a major development has occurred 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 by the statute of limitations, effectively declaring this $150 billion lawsuit a complete failure.

The case was heard in the Northern District of California federal court, and the jury reached a verdict in less than two hours. Judge Yvonne Gonzalez Rogers subsequently accepted the jury's opinion, ruling that OpenAI and the related defendants are not liable, and dismissed Musk's claims of "breach of charitable trust" and "unjust enrichment."

Musk officially filed suit in 2024, arguing that OpenAI deviated from its non-profit original mission established in 2015 and gradually shifted toward commercialization after significant investments from Microsoft. He claims OpenAI was initially intended to "benefit humanity" and avoid AI development being entirely driven by commercial interests.

* Related news: Musk, Altman lawsuit opening day: summarizing both sides' statements, lawyer debates, understanding the power struggle of OpenAI

Court finds Musk's claims were filed too late
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OpenAI lawyer Bill Savitt stated in court that Musk was already aware of changes in OpenAI’s organizational structure and business model adjustments but delayed years before filing suit. The court ultimately accepted this argument, ruling that the claims exceeded California's legal statute of limitations.



Image source: Reuters Court rules Musk's case failed

Under California law, the statute of limitations for lawsuits involving charitable trusts is 3 years, and 2 years for unjust enrichment. The jury believed that Musk knew early on that OpenAI was gradually shifting toward a profit-oriented model, making it impossible to reassert related rights years later.

Musk's team countered that the core dispute was not about timing but whether OpenAI violated its original promises. Musk stated in court that he had always believed Sam Altman's claims about OpenAI's vision, and only later realized the entire organization had completely changed direction.

However, the court also noted that Musk's team failed to produce legally valid documents proving that OpenAI was forever barred from transforming into a profit-driven structure. The entire trial heavily relied on early emails, conversation records, and oral discussions among founders.

OpenAI's path to commercialization cleared
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According to the lawsuit, Musk's team had requested the court to undertake a major restructuring of OpenAI, including replacing Sam Altman, overturning OpenAI’s recent commercialization framework, and even demanding Microsoft return substantial benefits gained from its partnership with OpenAI.

OpenAI's lawyers emphasized that large AI models require enormous computing power, chips, and funding support. Without a commercial structure, it would be difficult to compete with rivals like Google DeepMind. OpenAI also mentioned that Musk had previously discussed profit models and even hoped Tesla would lead OpenAI's development.



Image source: The Information OpenAI CEO Sam Altman

The outcome of this ruling is widely seen as a significant victory for OpenAI’s commercialization efforts. Since Musk’s lawsuit could have posed serious uncertainties for OpenAI’s future IPO, funding, and Microsoft collaborations, the court’s decision has notably reduced legal risks.

Currently, OpenAI’s market valuation has approached $850 billion, and it continues to compete with Anthropic, Google DeepMind, and xAI. Many believe that if OpenAI successfully goes public in the future, it could become one of the largest tech IPOs in recent years.

Conflict between Musk and OpenAI to continue
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Although this lawsuit was a major setback for Musk, the conflict is not entirely over. Musk’s lawyer Steven Molo has announced plans to appeal, arguing that the ruling mainly concerns procedural issues rather than the core case.

Several other legal cases between Musk and OpenAI are ongoing, including OpenAI’s counterclaims against Musk for malicious litigation tactics, and xAI’s antitrust lawsuit against OpenAI and Apple.

As xAI continues to develop the Grok model, the competition between Musk and OpenAI is gradually shifting from legal battles back to the AI market itself. Especially as AI models begin to influence search, social media, finance, and enterprise software markets, this conflict is evolving into a global struggle for AI dominance.