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“OpenAI is not for sale, and the board has unanimously rejected
Mr. Musk’s latest attempt to disrupt his competition," said a
statement Friday from Bret Taylor, chair of OpenAI's board.
OpenAI attorney William Savitt in a letter to Musk's attorney
Friday said the proposal “is not in the best interests of OAI’s
mission and is rejected.”
Musk, an early OpenAI investor, began a legal offensive against
the ChatGPT maker nearly a year ago, suing for breach of
contract over what he said was the betrayal of its founding aims
as a nonprofit.
OpenAI has increasingly sought to capitalize on the commercial
success of generative AI. But the for-profit company is a
subsidiary of a nonprofit entity that's bound to a mission —
which Musk helped set — to safely build better-than-human AI for
humanity's benefit. OpenAI is now seeking to more fully convert
itself to a for-profit company, but would first have to buy out
the nonprofit's assets.
Throwing a wrench in those plans, Musk and his own AI startup,
xAI, and a group of investment firms announced a bid Monday to
buy the nonprofit that controls OpenAI. Musk in a court filing
Wednesday further detailed the proposal to acquire the
nonprofit’s controlling stake.
Savitt's letter Friday said that court filing added “new
material conditions to the proposal. As a result of that filing,
it is now apparent that your clients’ much-publicized ‘bid’ is
in fact not a bid at all.” In any event, “even as first
presented,” the board has unanimously rejected it, Savitt said.
Musk has alleged in the lawsuit that OpenAI is violating the
terms of his foundational contributions to the charity. Musk had
invested about $45 million in the startup from its founding
until 2018, his lawyer has said.
He escalated the legal dispute late last year, adding new claims
and defendants, including OpenAI's business partner Microsoft,
and asking for a court order that would halt OpenAI’s for-profit
conversion. Musk also added xAI as a plaintiff, claiming that
OpenAI was also unfairly stifling business competition. A judge
is still considering Musk's request but expressed skepticism
about some of his claims in a court hearing last week.
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