Elon Musk said Sam Altman “stole” a nonprofit, but the trial showed he had similar goals

The jury’s quick decision to dismiss Elon Musk’s lawsuit against the co-founders of OpenAI and Microsoft confirmed what we saw in the courtroom: Musk’s case was weak, in part because he waited too long to file it.

While watching closing arguments last week, OpenAI’s lawyers detailed how the law was on their client’s side, while the plaintiffs’ team focused on Sam Altman’s apparent lack of credibility and expressed disbelief that anyone would disagree with Musk’s accusations.

The net effect was that, after the ruling, some found it hard to believe Musk had lost – including the man himself. In a post he later deleted, Musk called Judge Yvonne Gonzalez-Rogers a “terrible activist judge in Oakland,” and then announced his plans to appeal, declaring that “there is no doubt to anyone following the case in detail that Altman and Brockman have in fact enriched themselves by robbing a charity.”

But Altman and Brockman weren’t the only people to benefit from the nonprofit OpenAI’s investments. As much as Musk and his legal team tried to get Altman to court, the proceedings were equally revealing about Musk himself.

One incident presented to the court showed Musk taking advantage of OpenAI in a familiar and uncomfortable way. Greg Brockman testified that in 2017, Musk asked him to bring a team of OpenAI researchers to Tesla headquarters to help with the Autopilot team for a few weeks. “It was very clear that this was not something we could say no to,” Brockman said.

Brockman described taking a team of senior scientists, including Andrei Karpathy, Ilya Sutskever, and Scott Gray, to consult with “frustrated” Tesla workers. They helped come up with ideas to improve the car’s self-driving technology, with Sutskever telling the team that if they could find 10,000 images of a difficult corner situation, they would be able to fix their software. Musk even asked Brockman to recommend that employees be fired, which he refused to do.

Another person familiar with the incident confirmed Brockman’s account and said that Tesla did not compensate OpenAI for the time and effort of its employees. Musk’s family office, Excession, did not respond to a request for comment.

The crux of Musk’s case is that Altman, Brockman, and OpenAI committed a “breach of charitable trust” — where Musk donated money for a specific charitable purpose, and the co-founders instead used it for something else. It also accuses them of being “unjustly enriched” by shares and other benefits from for-profit OpenAI.

In the event that OpenAI scientists were parachuted into Tesla, Musk’s charitable donations were intended to hire scientists focused on securing the benefits of general artificial intelligence. Instead, he made them work for free at his for-profit company.

The arrangement wouldn’t be legal, Dorothy Lund, a professor at Columbia Law School and co-host of Beyond Unprecedented, told TechCrunch, calling it “a bit rich for Musk to sue for breach of a charitable trust, when it appears he was redirecting assets in a way inconsistent with that mission.”

It is true that self-driving work involves artificial intelligence, but Musk’s witnesses confirmed that Tesla’s self-driving project was very different from the OpenAI research agenda. This is partly because Karpathy left OpenAI for Tesla shortly after this incident. OpenAI’s lawyers portrayed Musk’s departure as a breach of his duty to the lab, where he was co-chairman of the board, by appointing one of the principal researchers to his own company.

Another fact that undoubtedly swayed the jury was the amount of time Musk spent trying to gain sole control of a potential for-profit OpenAI subsidiary in 2017. Musk used good cop, bad cop tactics to try to convince his co-founders to let him take full control of the for-profit OpenAI subsidiary — giving them free Teslas, and threatening to withhold his donations.

His efforts put his lawyers in a difficult position, as they faced the need to convince the jury that there was a significant difference between what Musk envisioned and the profit that was ultimately created. They suggested that a for-profit “small appendage” should be permissible, although OpenAI witnesses have shown that nonprofits with large commercial arms are common.

In fact, there’s a counterfactual: Musk accepted one of his founders’ offers to split their shares equally, and today finds himself one of OpenAI’s largest — but not controlling — shareholders. But several times during the trial, Musk’s associates testified that he refused to invest in any business over which he could have sole control.

The failure of Musk’s claims because he filed them too late has been cited as a technical reason, but the statute of limitations has substance behind it: People and companies make important decisions and spend resources based on their understanding that what they are doing is permissible. If someone like Musk waits too long to file a lawsuit, the cost of resolving all those decisions could outweigh fair compensation.

None of the jury members spoke about how they reached their verdict. However, they were asked to consider whether Musk would do so before August 5, 2021 He should I knew that OpenAI was spending resources outside of its mission or launching a for-profit subsidiary. The answer to that is clear: Musk himself was doing those things.