The legal showdown between Elon Musk and OpenAI reached a boiling point this week as the federal trial officially opened in Oakland, California. Musk, who took the witness stand on Tuesday, April 28, and Wednesday, April 29, 2026, faced intense questioning regarding his own early views on profit and control within the organization.
The trial, presided over by Judge Yvonne Gonzalez Rogers, centers on whether OpenAI betrayed its founding nonprofit mission by becoming a “for-profit juggernaut” valued at over $850 billion.
Key Testimony: “The Tail Wagging the Dog”
Musk’s testimony was marked by a mix of philosophical warnings about AI and combative exchanges with OpenAI’s legal team:
- The “Small Adjunct” Argument: Musk admitted he wasn’t entirely against a for-profit arm in the early days, provided it served as a “small adjunct” to fund the nonprofit. However, he argued the current structure—backed by $13 billion from Microsoft—is a case of the “tail wagging the dog.”
- “They Stole a Charity”: Musk’s lead attorney, Steven Molo, likened OpenAI to a museum that “sold the Picasso and pocketed the profits.” Musk testified that he only donated roughly $38 million because he believed the tech would be open-source and for the public good.
- The Control Question: OpenAI’s lead lawyer, William Savitt, grilled Musk on 2017 emails that showed Musk himself once proposed taking a 55% stake in a for-profit version of OpenAI. Savitt argued Musk only left and sued because he was denied “full control,” calling the lawsuit a “harassment campaign” by a bitter competitor (referencing Musk’s own AI firm, xAI).
High Stakes & Restructuring
The outcome of this trial could fundamentally shift the AI industry:
- Damages & Leadership: Musk is seeking roughly $134 billion to $150 billion in damages—which he specifies should be returned to OpenAI’s charitable arm—along with the removal of Sam Altman and Greg Brockman from leadership.
- The IPO Threat: Legal analysts suggest a victory for Musk could derail OpenAI’s plans for a $1 trillion IPO later this year and force the company to revert to its original nonprofit governance.
- The Microsoft Factor: Microsoft is also a defendant, accused of “aiding and abetting” the breach of trust. In response, Microsoft recently reworked its agreement with OpenAI, ending its exclusive license to OpenAI’s technology as of April 2026 to mitigate regulatory and legal pressure.
