Elon Musk Lost to OpenAI! $150 Billion Lawsuit Rejected; the Key to Losing Was the “Timing of Filing the Lawsuit”

Musk sues OpenAI over alleged claims beyond the statute of limitations and the court rejects the case in full. This judgment removes legal risks tied to commercialization and clears obstacles for future listing plans.

OpenAI wins as the court dismisses Musk’s lawsuit in full

According to a report by NBC, there has been a major turn in the two-year legal battle between Elon Musk and OpenAI. On May 18, a federal jury in California ruled that multiple claims brought by Musk against OpenAI, Sam Altman, Greg Brockman, and Microsoft are time-barred under the statute of limitations, which is tantamount to a complete failure of this $150 billion lawsuit.

The case was heard in the U.S. Federal Court for the Northern District of California, and the jury reached a verdict in under two hours. Judge Yvonne Gonzalez Rogers then accepted the jury’s findings, determining that OpenAI and the related defendants do not need to bear legal responsibility, while dismissing Musk’s claims such as “breach of charitable trust” and “unjust enrichment.”

Musk formally filed the lawsuit in 2024. His core argument is that OpenAI deviated from its original non-profit mission when it was established in 2015, and that after Microsoft made significant investments, it gradually shifted toward commercialization. He argues that OpenAI was originally supposed to aim to “benefit humanity,” and to prevent AI development from being entirely driven by commercial interests.

• Related news: Musk and Altman’s lawsuit opens—day one recap of both sides’ statements and lawyers’ arguments to understand the power struggle at OpenAI

The court holds that Musk filed too late

In court, OpenAI lawyer Bill Savitt pointed out that Musk had long been aware of changes to OpenAI’s organizational structure and adjustments to its business model, yet still delayed for years before bringing the lawsuit. The court ultimately accepted this argument and found that the related requests were beyond California’s legally prescribed statute of limitations.

Image source: Reuters Court rules Musk loses

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 had known early on that OpenAI was gradually moving toward a for-profit model, meaning he could not reassert related rights years later.

Musk’s team countered that the core issue in this case was not about timing, but whether OpenAI had violated its original commitments. Musk said in court that he had always believed Sam Altman’s statements about OpenAI’s vision, and only later realized that the entire organization had completely changed direction.

However, the court also noted that Musk’s team was unable to submit legally valid official documents to prove that OpenAI could never be transformed into a for-profit structure. The trial ultimately relied heavily on early emails, records of conversations, and oral discussions among the founders.

OpenAI’s commercialization roadblock cleared

According to the allegations in the lawsuit, Musk’s team had asked the court to conduct a large-scale 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 gained through its collaboration with OpenAI.

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

Image source: The Information OpenAI CEO Sam Altman

The result of this ruling is also seen by many as a major victory for OpenAI’s path to commercialization. Because Musk’s lawsuit could have created significant uncertainty for OpenAI’s future IPO, financing, and its collaboration with Microsoft, the court’s decision has clearly reduced related legal risks.

Currently, OpenAI’s market valuation is approaching $850 billion, and it continues to compete with Anthropic, Google DeepMind, and xAI in the AI race. Many believe that if OpenAI successfully lists in the future, it could become one of the largest tech IPOs globally in recent years.

Musk and OpenAI’s conflict will continue

Although this lawsuit’s outcome is a major setback for Musk, the conflict between the two sides has not completely ended. Musk’s lawyer Steven Molo has said that he will file an appeal, arguing that this ruling is mainly a matter of procedural issues rather than the substance of the case itself.

At present, multiple legal cases are still ongoing between Musk and OpenAI, including OpenAI’s counterclaims accusing Musk of using malicious litigation strategies, and xAI’s antitrust lawsuits 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 marketplace itself. In particular, as AI models begin to influence the search, social, financial, and enterprise software markets, this conflict has increasingly evolved into a global battle over who will lead AI.