6 years of heated arguments, resolved in 2 hours, Musk vs. Altman first battle ends in failure

Author | Hualin Wuwang

Editor | Jingyu

In the classic gangster film The Godfather, there’s a line that has endured to this day—“This isn’t a personal grudge. This is business.”

But in real life, things are often far more complicated. When business and private grievances get mixed together—when one person is both a former co-founder and today’s strongest competitor—it’s hard to say whether that lawsuit is a legal filing or a long-delayed letter of severance.

In Silicon Valley, and indeed across the United States, the most closely watched legal showdown right now is undoubtedly the ongoing courtroom battle between Musk and Altman.

Now, after years of this “grudge,” the case has finally produced results in its first phase.

On May 18, 2026, local time, at the U.S. Federal Court in San Francisco, nine jurors reached a verdict in under 2 hours—Musk lost.

01 Six years of grudge ends with a verdict

The jury’s decision wasn’t complicated—some might even call it “technical.”

The court didn’t directly address Musk’s most central allegation: whether OpenAI betrayed its original charitable mission when it spun off its profitable business from the nonprofit parent and brought in commercial investors such as Microsoft. Instead, the jury sidestepped that “soul-searching question” and dismissed all claims on the grounds of the statute of limitations.

California law requires that such claims be filed within three years of the relevant events. OpenAI’s decision to open investment to Microsoft and progressively advance its commercial transformation—these key milestones were already public well before 2019, around that period. Musk didn’t formally file suit until 2024, and the jury found that this was beyond the statutory time limit.

9 votes to 0. Unanimously passed.

After the trial, Judge Yvonne Gonzalez Rogers said there was abundant evidence supporting the jury’s decision, and she even directly stated that she was ready to “dismiss on the spot” any motions to dismiss Musk might file in connection with an appeal. The wording was so decisive that it’s fairly rare.

OpenAI chief lawyer William Savitt’s characterization after the hearing went straight through the core of Musk’s narrative as well—“This is not a technical decision, but a substantive one. You filed your claims too late, and the reason you did so is that you (Musk) are keeping these claims as a weapon to prevent you from being unable to compete against your rivals in the market.”

Those are heavy words. The implied message is clear: Musk isn’t the plaintiff—he’s a business rival using legal procedures like a blade.

02 Lawsuit or tearing each other apart?

To understand the real logic of this case, you have to go back to 2015.

That year, Musk, Altman, and Greg Brockman and others jointly founded OpenAI, explicitly positioning it as a nonprofit organization whose mission was “to develop safe artificial intelligence for the benefit of all humanity.” In the early days, Musk provided substantial funding and was deeply involved in discussions about the company’s direction.

In 2018, he left the board, citing “a conflict of interest with Tesla’s business.”

What followed is largely well known. In 2019, OpenAI brought in Microsoft’s investment and gradually built a “limited-profit” hybrid structure. Then ChatGPT emerged, and its valuation skyrocketed. Meanwhile, in 2023, Musk founded his own AI company, xAI, launched the Grok model, and moved to compete head-on with OpenAI.

In 2024, the complaint was formally filed. Musk accused Altman and Brockman of violating their initial charitable commitments by commercializing the company—resulting in a massive surge in his personal wealth. The word he used was “stealing from a charitable organization.”

This narrative has a certain moral appeal, but the timeline betrays him.

The key decisions behind OpenAI’s shift toward commercialization took place between 2019 and 2021, throughout which time the process was conducted openly and transparently, and tech media covered it extensively. Musk wasn’t unaware; rather, he chose the most critical window—after his competitors had already grown large and on the eve of the IPO—to play this card.

Even after the hearing, Musk’s lawyer Marc Toberoff maintained a moral stance—“This is a statement that OpenAI abused its charitable status. If it weren’t for Musk, they would have gotten away with it.” But they also announced they would appeal to the Ninth Circuit Court of Appeals, making it clear this fight wasn’t truly over.

03 Is the downside for OpenAI fully out?

From OpenAI’s perspective, the significance of this ruling goes far beyond the law itself.

Wall Street analysts’ interpretation is the most direct. Dan Ives, an analyst at Wedbush Securities, pointed out that the biggest potential threat from this lawsuit lies in the possibility that it could force OpenAI into a large-scale structural reshuffle. If the court determined that the commercialization transition violated charitable trust obligations, the company’s entire corporate structure could face disruptive change.

“Now, the worst-case scenario has basically been ruled out, which is a major positive for OpenAI’s IPO.”

A legal sword of Damocles hanging over their heads for six years was thus brought down within two hours.

And OpenAI’s business momentum is at its strongest point in history. Over the past two weeks, the company released a steady stream of signals: the newly launched GPT-5.5 Instant became ChatGPT’s default model, reducing the hallucination rate by more than 50% in high-risk scenarios; three real-time audio models targeting enterprise use were released in parallel, including GPT-Realtime-Translate, which supports real-time translation in more than 70 languages; and the Codex programming assistant has also launched on mobile, enabling developers to review code and approve commands anywhere.

At the same time, in a new funding round completed about two weeks ago, OpenAI raised $12.2 billion at a valuation of $852 billion, co-led by Amazon, Nvidia, SoftBank, and Microsoft. Based on the latest data, the company’s monthly revenue is already about $2 billion, with more than 900 million weekly active users.

At this point, any legal risk that could trigger a corporate restructuring would be the most dangerous variable in the IPO process—and the verdict clears that hazard.

Microsoft’s statement is also quite telling—“The facts and timeline of this case have always been clear. We welcome the jury’s decision to dismiss these claims, and we remain committed to continuing to work with OpenAI.” As OpenAI’s largest external partner, Microsoft’s phrasing is calm and resolute.

04 The questions no one answered

One point that needs clarification is that the outcome of the verdict shouldn’t be over-interpreted as a moral “acquittal.”

The jury rejected the claims based on the statute of limitations—not because “OpenAI didn’t betray its mission.”

From start to finish, the court never answered the core question: after a nonprofit institution created under the banner of “benefiting all humanity” became a tech giant with a valuation in the thousands of billions, where did its founding spirit go?

That question won’t disappear just because a lawsuit ends.

In fact, right as OpenAI’s IPO window was approaching, the company was quietly adjusting its structure and redefining the relationship between its nonprofit portion and its for-profit entities. This isn’t a concession to Musk—it’s a structural issue the entire AI industry must confront in the process of commercialization.

The tension between technological idealism and business pragmatism is the eternal underlying contradiction in Silicon Valley.

From Google’s early “Don’t be evil,” to Facebook’s “Connect the world,” and now OpenAI’s “For all humanity,” these lofty founding narratives have ultimately undergone different degrees of distortion under the gravitational pull of capital. No matter what motivated Musk’s anger, it touched a real anxiety: when AI—a technology that could reshape civilization—is placed inside a commercial company preparing for an IPO, what exactly should we believe?

This question can’t be answered by the court.

Musk has announced an appeal; Altman has won today. But the deeper debate over who AI belongs to—and who should control it—has only entered a new phase.