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In what capacity is Musk suing OpenAI? Musk may have co-founded the company, but then he left (to avoid any potential future conflict of interest with his role

In what capacity is Musk suing OpenAI? Musk may have co-founded the company, but then he left (to avoid any potential future conflict of interest with his role as CEO of Tesla, as Tesla was increasingly becoming an AI-intensive company). Is he a shareholder, if not what gives him any say in the future of the company?

username332211 3y ago
He's a donor to the OpenAi non-profit organization.
- breadwinner 3y ago
  A donor usually is only able to say how his donation will be used. For example, if you donate to Harvard University, you can say the money will be earmarked for scholarships, but you don't get a say on how the university is managed. You can at best say you will no longer donate based on how the university is managed.
  - whythre 3y ago
    You can sue for basically any reason in the US. If Musk is able to prove they are mishandling the money, which I think is debatable, then the case can proceed. Just because you donate money doesn’t mean the charity or nonprofit (or whatever OpenAi is), can do as they like. They may still be committing fraud if they are not using the money in the way that they claim.
    - deleted 3y ago
      [deleted]
    - solardev 3y ago
      Don't you have to have some sort of standing in the lawsuit? If you don't directly suffer harm, I thought you'd have to convince the government to prosecute them instead? (Not a lawyer, obviously.)
      - JohnFen 3y ago
        You can file a lawsuit for anything. If the lawsuit has serious fundamental flaws (such as lack of standing), then it will be dismissed pretty quickly.
        psunavy03 3y ago
        Well you can also be spanked by the courts for frivolous litigation, and if it's truly frivolous, you may have a hard time finding an attorney, because they can be sanctioned for bringing such a suit as well.
        whythre 3y ago
        This can happen in theory, but it is pretty rare. What you or I might call frivolous is often entertained in the court of law, and serial abusers of the court system may still issue hundreds or even thousands of attempts at lawsuits. This may be for monetary gain or to use the specter of the lawsuit as a cudgel to influence or intimidate. This can also be exacerbated by ‘friendly’ (corrupt) courts that allow or even encourage this behavior.
        deaddodo 3y ago
        It takes quite a bit of frivolous filing to get hit with any sanctions or fines. A single frivolous lawsuit happens here and there, it's when people/organizations are clearly malicious and abusing the system by filing continuous suits against others.
      - lucianbr 3y ago
        If Musk donated money to a nonprofit and now the nonprofit is using the money to make profit, that sounds like he was defrauded to me. They took his money under false pretenses. Not a lawyer either, so it may turn out technically he does not have standing, but naively it sure looks like he has. I don't understand the framing of your question, is it "since he donated, he didn't expect anything in return, so he is not harmed no matter what they do"? Kinda seems like people asking for donations should not lie about the reason for the donation, even if it is a donation.
  - ajhurliman 3y ago
    What about: "I want you to earmark this for open source AI research, and not R&D specifically aimed at making profits"
  - Retric 3y ago
    A donor can sue and win in cases of fraud. Being a 501 (c) isn’t some shield that means any behavior is permitted. In this case there’s a specific agreement that’s allegedly been breached. Basically they said results of AI research would be shared openly without benefiting any specific party, and then later entered into a private agreement with Microsoft. I don’t know how binding any of this is, but I doubt this will simply be dismissed by the judge.
    - dragonwriter 3y ago
      > Being a 501 (c) isn’t some shield that means any behavior is permitted. Its pretty much—especially a 501c3—the opposite, a substantial set of restrictions in behavior, on top of those which would face an organization doing similar things that was not a 501c3.
  - username332211 3y ago
    I certainly hope "turning the non-profit into an LLC" is slightly different legally. If not, I certainly hope the courts establish a clear precedent so that The Red Cross can do an IPO. Or even better, the state SPCAs. "Our unique value proposition is that we can take anyone's dog away."
  - simpletone 3y ago
    > but you don't get a say on how the university is managed. Depends on how big and important of a donor you are. If you are a billionaire donor, not only do you have a say in how the university is managed, you have a say on who does the managing. > You can at best say you will no longer donate based on how the university is managed. Tell that to the former presidents of harvard, upenn, etc.
  - s1artibartfast 3y ago
    You can say how it is run if you found the University and put your conditions in the legal Charter of the organization. It is a problem if the university Chancellor later decides the primary purpose of the university is to save puppies without going through the correct process to change the charter.
- FrustratedMonky 3y ago
  Which is funny. If you are shareholder of the non-profit, do you not get to share any of the fat gains by the profit side?
Hamuko 3y ago
Would he have standing by having a company competing in the same space as OpenAI?
- breadwinner 3y ago
  He would have the opposite of a standing, right? It seems he wants to slow down OpenAI so that his competing company can catch up.
  - Hamuko 3y ago
    I mean, if I run a fridge company and another fridge company is doing something nefarious, I'd have more of a claim for damages than someone that runs a blender company, right? That's at least my layperson's interpretation. Since Musk is suing for "unfair business practices". I also found this: https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=1519&context=uclf https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?arti... >Representative of its remedial objectives, the [Unfair Competition Law] originally granted standing to "any person" suing on behalf of "itself, its members, or on behalf of the general public." This prompted a public outcry over perceived abuses of the UCL because the UCL granted standing to plaintiffs without requiring them to show any actual injury. In response, California voters approved Proposition to amend the UCL to require that the plaintiff prove injury from the unfair practice. Despite this stricter standing requirement, both business competitors and consumers may still sue under the UCL.
  - Gormo 3y ago
    Or, looking at it the other way, he is complaining that a non-profit organization he donated funds to has allocated those funds to engage in for-profit business that directly competes with his own. Viewed that way, he ought to have extra standing.
  - stubish 3y ago
    No, you can reasonably expect an open source company to open their source. Allowing you and everyone else to benefit from the work. The lawsuit is because all of the competing companies should not need to be wasting money catching up, when the goal was for everyone to be building from OpenAI's work.
tiahura 3y ago
If only there was a document that you could refer to to inform your post.
jcranmer 3y ago
The essential theory of the case is that OpenAI is misusing the funds Musk donated to it. reads prayer for relief > For a judicial determination that GPT-4 constitutes Artificial General Intelligence Okay, WTF? I'm going to have to read the entire complaint now.....
- SonOfLilit 3y ago
  I assume this is because OpenAI committed to do certain things if and when they build AGI.
- empath-nirvana 3y ago
  Man is that a big juicy meatball if you're a judge, though. Who would not love to hear that case.
- bloggie 3y ago
  I think OpenAI has been using the excuse that GPT-4 is not AGI, and therefore can remain closed-source.
- manquer 3y ago
  AGI as defined narrowly by OpenAI, Microsoft et al for their contracts, not what scientists would define it as . While I don’t think we are close to AGI, we also have to acknowledge that term is forever changing meaning and goal posts , even 10 years back a Turing test would be considered sufficient, obviously not anymore . The scientific, public understanding is changing constantly and a court would have difficulty in making a decision if there is no consensus , it only has to see if the contractual definition has been met
Thrymr 3y ago
He is suing for breach of agreement, namely the founding agreement that formed OpenAI as a nonprofit.
wyantb 3y ago
Breach of contract seems to be the major one - from https://www.scribd.com/document/709742948/Musk-vs-OpenAI https://www.scribd.com/document/709742948/Musk-vs-OpenAI page 34 has the prayers for relief. B and C seem insane to me, I don't see how a court could decide that. On the other hand, compelling specific performance based on continual reaffirmations of the founding agreement (page 15)...seems viable at a glance. Musk is presumably a party to several relevant contracts, and given his investment and efforts, I could see this going somewhere. (Even if his motivations are in fact to ding Microsoft / spite Altman). IANAL
- deleted 3y ago
  [deleted]
- gamblor956 3y ago
  The "reaffirmations" referred to on page 15 don't mean anything. Altman merely said he was "enthusiastic" about the nonprofit structure, not that he was limiting OpenAI to it. And notably, the "I" is that quote is bracketed, meaning that Altman did not actually say "I" in his response to Musk (in legal documents, brackets in quotes mean that the quote has been altered between the brackets). Furthermore, despite the headline to that section claiming "repeat" reaffirmations, based on the facts as presented by Musk's own lawyers, Altman only potentially reaffirms the nonprofit structure once... And the other individuals aren't even quoted, which is strong evidence that they didn't actually say anything even remotely in support of "reaffirming" the nonprofit structure (especially given that his lawyers were heavy handed with including quotes when they could be even remotely construed in favor of Musk's position) and that Musk is unilaterally characterizing whatever they actually said to support his claims, however reasonable or unreasonable that may be. Due to the money at stake, and given that both Musk and Altman have serious credibility issues that would make a trial outcome impossible to predict, I expect this to be settled by giving Musk a bunch of stock in the for-profit entity to make shut up.
- paulddraper 3y ago
  > B and C seem insane to me, I don't see how a court could decide that. If it's part of a legal document, they're certainly the ones to decide that (relying on precedent, expert testimony, logical reasoning, etc.)
AlwaysRock 3y ago
The filing is listed with all the reasons for the suit here: https://www.courthousenews.com/wp-content/uploads/2024/02/musk-v-altman-openai-complaint-sf.pdf https://www.courthousenews.com/wp-content/uploads/2024/02/mu...
deleted 3y ago
[deleted]

username332211 3y ago

He's a donor to the OpenAi non-profit organization.

breadwinner 3y ago
A donor usually is only able to say how his donation will be used. For example, if you donate to Harvard University, you can say the money will be earmarked for scholarships, but you don't get a say on how the university is managed. You can at best say you will no longer donate based on how the university is managed.
- whythre 3y ago
  You can sue for basically any reason in the US. If Musk is able to prove they are mishandling the money, which I think is debatable, then the case can proceed. Just because you donate money doesn’t mean the charity or nonprofit (or whatever OpenAi is), can do as they like. They may still be committing fraud if they are not using the money in the way that they claim.
  - deleted 3y ago
    [deleted]
  - solardev 3y ago
    Don't you have to have some sort of standing in the lawsuit? If you don't directly suffer harm, I thought you'd have to convince the government to prosecute them instead? (Not a lawyer, obviously.)
    - JohnFen 3y ago
      You can file a lawsuit for anything. If the lawsuit has serious fundamental flaws (such as lack of standing), then it will be dismissed pretty quickly.
      - psunavy03 3y ago
        Well you can also be spanked by the courts for frivolous litigation, and if it's truly frivolous, you may have a hard time finding an attorney, because they can be sanctioned for bringing such a suit as well.
        whythre 3y ago
        This can happen in theory, but it is pretty rare. What you or I might call frivolous is often entertained in the court of law, and serial abusers of the court system may still issue hundreds or even thousands of attempts at lawsuits. This may be for monetary gain or to use the specter of the lawsuit as a cudgel to influence or intimidate. This can also be exacerbated by ‘friendly’ (corrupt) courts that allow or even encourage this behavior.
        deaddodo 3y ago
        It takes quite a bit of frivolous filing to get hit with any sanctions or fines. A single frivolous lawsuit happens here and there, it's when people/organizations are clearly malicious and abusing the system by filing continuous suits against others.
    - lucianbr 3y ago
      If Musk donated money to a nonprofit and now the nonprofit is using the money to make profit, that sounds like he was defrauded to me. They took his money under false pretenses. Not a lawyer either, so it may turn out technically he does not have standing, but naively it sure looks like he has. I don't understand the framing of your question, is it "since he donated, he didn't expect anything in return, so he is not harmed no matter what they do"? Kinda seems like people asking for donations should not lie about the reason for the donation, even if it is a donation.
- ajhurliman 3y ago
  What about: "I want you to earmark this for open source AI research, and not R&D specifically aimed at making profits"
- Retric 3y ago
  A donor can sue and win in cases of fraud. Being a 501 (c) isn’t some shield that means any behavior is permitted. In this case there’s a specific agreement that’s allegedly been breached. Basically they said results of AI research would be shared openly without benefiting any specific party, and then later entered into a private agreement with Microsoft. I don’t know how binding any of this is, but I doubt this will simply be dismissed by the judge.
  - dragonwriter 3y ago
    > Being a 501 (c) isn’t some shield that means any behavior is permitted. Its pretty much—especially a 501c3—the opposite, a substantial set of restrictions in behavior, on top of those which would face an organization doing similar things that was not a 501c3.
- username332211 3y ago
  I certainly hope "turning the non-profit into an LLC" is slightly different legally. If not, I certainly hope the courts establish a clear precedent so that The Red Cross can do an IPO. Or even better, the state SPCAs. "Our unique value proposition is that we can take anyone's dog away."
- simpletone 3y ago
  > but you don't get a say on how the university is managed. Depends on how big and important of a donor you are. If you are a billionaire donor, not only do you have a say in how the university is managed, you have a say on who does the managing. > You can at best say you will no longer donate based on how the university is managed. Tell that to the former presidents of harvard, upenn, etc.
- s1artibartfast 3y ago
  You can say how it is run if you found the University and put your conditions in the legal Charter of the organization. It is a problem if the university Chancellor later decides the primary purpose of the university is to save puppies without going through the correct process to change the charter.
FrustratedMonky 3y ago
Which is funny. If you are shareholder of the non-profit, do you not get to share any of the fat gains by the profit side?

Hamuko 3y ago

Would he have standing by having a company competing in the same space as OpenAI?

breadwinner 3y ago
He would have the opposite of a standing, right? It seems he wants to slow down OpenAI so that his competing company can catch up.
- Hamuko 3y ago
  I mean, if I run a fridge company and another fridge company is doing something nefarious, I'd have more of a claim for damages than someone that runs a blender company, right? That's at least my layperson's interpretation. Since Musk is suing for "unfair business practices". I also found this: https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=1519&context=uclf https://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?arti... >Representative of its remedial objectives, the [Unfair Competition Law] originally granted standing to "any person" suing on behalf of "itself, its members, or on behalf of the general public." This prompted a public outcry over perceived abuses of the UCL because the UCL granted standing to plaintiffs without requiring them to show any actual injury. In response, California voters approved Proposition to amend the UCL to require that the plaintiff prove injury from the unfair practice. Despite this stricter standing requirement, both business competitors and consumers may still sue under the UCL.
- Gormo 3y ago
  Or, looking at it the other way, he is complaining that a non-profit organization he donated funds to has allocated those funds to engage in for-profit business that directly competes with his own. Viewed that way, he ought to have extra standing.
- stubish 3y ago
  No, you can reasonably expect an open source company to open their source. Allowing you and everyone else to benefit from the work. The lawsuit is because all of the competing companies should not need to be wasting money catching up, when the goal was for everyone to be building from OpenAI's work.

tiahura 3y ago

If only there was a document that you could refer to to inform your post.

jcranmer 3y ago

The essential theory of the case is that OpenAI is misusing the funds Musk donated to it. reads prayer for relief > For a judicial determination that GPT-4 constitutes Artificial General Intelligence Okay, WTF? I'm going to have to read the entire complaint now.....

SonOfLilit 3y ago
I assume this is because OpenAI committed to do certain things if and when they build AGI.
empath-nirvana 3y ago
Man is that a big juicy meatball if you're a judge, though. Who would not love to hear that case.
bloggie 3y ago
I think OpenAI has been using the excuse that GPT-4 is not AGI, and therefore can remain closed-source.
manquer 3y ago
AGI as defined narrowly by OpenAI, Microsoft et al for their contracts, not what scientists would define it as . While I don’t think we are close to AGI, we also have to acknowledge that term is forever changing meaning and goal posts , even 10 years back a Turing test would be considered sufficient, obviously not anymore . The scientific, public understanding is changing constantly and a court would have difficulty in making a decision if there is no consensus , it only has to see if the contractual definition has been met

Thrymr 3y ago

He is suing for breach of agreement, namely the founding agreement that formed OpenAI as a nonprofit.

wyantb 3y ago

Breach of contract seems to be the major one - from https://www.scribd.com/document/709742948/Musk-vs-OpenAI https://www.scribd.com/document/709742948/Musk-vs-OpenAI page 34 has the prayers for relief. B and C seem insane to me, I don't see how a court could decide that. On the other hand, compelling specific performance based on continual reaffirmations of the founding agreement (page 15)...seems viable at a glance. Musk is presumably a party to several relevant contracts, and given his investment and efforts, I could see this going somewhere. (Even if his motivations are in fact to ding Microsoft / spite Altman). IANAL

deleted 3y ago
[deleted]
gamblor956 3y ago
The "reaffirmations" referred to on page 15 don't mean anything. Altman merely said he was "enthusiastic" about the nonprofit structure, not that he was limiting OpenAI to it. And notably, the "I" is that quote is bracketed, meaning that Altman did not actually say "I" in his response to Musk (in legal documents, brackets in quotes mean that the quote has been altered between the brackets). Furthermore, despite the headline to that section claiming "repeat" reaffirmations, based on the facts as presented by Musk's own lawyers, Altman only potentially reaffirms the nonprofit structure once... And the other individuals aren't even quoted, which is strong evidence that they didn't actually say anything even remotely in support of "reaffirming" the nonprofit structure (especially given that his lawyers were heavy handed with including quotes when they could be even remotely construed in favor of Musk's position) and that Musk is unilaterally characterizing whatever they actually said to support his claims, however reasonable or unreasonable that may be. Due to the money at stake, and given that both Musk and Altman have serious credibility issues that would make a trial outcome impossible to predict, I expect this to be settled by giving Musk a bunch of stock in the for-profit entity to make shut up.
paulddraper 3y ago
> B and C seem insane to me, I don't see how a court could decide that. If it's part of a legal document, they're certainly the ones to decide that (relying on precedent, expert testimony, logical reasoning, etc.)

AlwaysRock 3y ago

The filing is listed with all the reasons for the suit here: https://www.courthousenews.com/wp-content/uploads/2024/02/musk-v-altman-openai-complaint-sf.pdf https://www.courthousenews.com/wp-content/uploads/2024/02/mu...

deleted 3y ago

[deleted]