One of the most closely watched legal showdowns in the global tech industry moved into a critical phase this week in Northern California, where OpenAI CEO Sam Altman is preparing to take the witness stand Tuesday to respond to explosive allegations brought by billionaire entrepreneur Elon Musk. The high-profile civil lawsuit, filed by the Tesla and SpaceX founder who also leads competing AI firm xAI, centers on accusations that Altman and OpenAI co-founder Greg Brockman misused Musk’s early $38 million in founding contributions after the company abandoned its original non-profit mission to transform into the for-profit juggernaut behind ChatGPT, the generative AI tool that sparked the current global AI boom.
Musk’s legal team is pushing for a dramatic remedy: a court order forcing OpenAI to revert to its original non-profit structure. Industry analysts note that such a ruling would upend OpenAI’s position in the cutthroat global artificial intelligence race, where it currently competes against major players including Anthropic, Google DeepMind, and China’s Deepseek.
OpenAI’s defense has pushed back sharply against Musk’s claims, arguing that the billionaire’s lawsuit is rooted in personal resentment rather than principle. OpenAI maintains that Musk abandoned his early role at the company after failing to negotiate a majority controlling stake, and now he is seeking petty revenge as he builds his own competing AI venture, xAI.
The Oakland courtroom, located just outside the global tech hub of San Francisco, has played host to testimony from some of the wealthiest and most influential leaders in the technology sector this week. On Monday, Microsoft CEO Satya Nadella took the stand to defend his company’s landmark early investment in OpenAI, a partnership that has reshaped the global AI landscape.
Nadella told the jury he remains “very proud” of Microsoft’s bet on OpenAI. The tech giant now holds roughly a 25% stake in OpenAI Group PBC, the parent company behind ChatGPT, with the original non-profit arm retaining a core ownership position. Nadella emphasized that the partnership has ultimately strengthened, rather than undermined, OpenAI’s original philanthropic goals, creating “one of the largest, most well-funded nonprofits in the world” that can advance public good through AI research.
Musk’s legal team has argued that Microsoft always harbored commercial ambitions for its investment, pointing to internal company documents that they claim prove the tech giant prioritized profit over philanthropic AI development from the start. Microsoft’s initial $13 billion investment has grown exponentially in value, with current estimates placing the stake’s worth as high as $135 billion, a dramatic return on the company’s early risk.
Nadella pushed back against that characterization, framing the investment as a straightforward good-faith bet on emerging technology. “It has worked out well because we took the risk,” Nadella told the court. “If the pie became larger, obviously the nonprofit would benefit as well with their mission — and that’s what in fact it’s proven.”
Musk’s lawyers also highlighted Microsoft’s central role in OpenAI’s 2023 pivot to full commercial operation, pointing to a 2023 comment from Nadella in which he stated “We have the people, we have the compute, we have the data, we have everything.” The relationship between the two companies was further cemented during the chaotic 2025 OpenAI board crisis, when Nadella and Microsoft publicly backed Altman after he was temporarily ousted by the board. Following a five-day internal standoff, Altman was reinstated as CEO, with Microsoft gaining a non-voting observer seat on the restructured board.
An advisory jury is expected to deliver its verdict on whether any wrongdoing occurred by the week of May 18. After receiving the jury’s non-binding opinion, Judge Yvonne Gonzalez Rogers will issue a final ruling on both liability and potential remedies. The judge has already indicated she is likely to follow the advisory jury’s recommendation in her final decision.