On May 18, following approximately 90 minutes of deliberations, an advisory jury found in favor of the defendants in Musk v. Altman. Judge Yvonne Gonzalez Rogers subsequently adopted the jury’s recommendation, concluding that the applicable statute of limitations barred the claims asserted by Elon Musk. The litigation began on August 5, 2024, when Musk sued Sam Altman, Gregory Brockman, OpenAI, Inc., and affiliated entities. While the ruling turned on a procedural issue rather than the merits, the dispute remains one of the most closely watched cases in the rapidly evolving artificial-intelligence industry.
Background
Artificial intelligence has become a dominant force across business, education, communications, and countless other aspects of modern life. But when OpenAI was founded in 2015, AI remained largely a developing technology with uncertain commercial applications. Industry leaders, however, recognized its transformative potential and raced to shape the future of the field.
According to Musk’s complaint, one central concern during OpenAI’s formation was whether advanced AI could ultimately pose risks to humanity. Musk alleges that Altman proposed a solution: an organization dedicated to developing artificial general intelligence for the benefit of humanity rather than for private profit. Musk ultimately contributed more than $44 million to OpenAI. He now contends that OpenAI’s leaders used those representations to secure funding before transforming the organization into a highly valuable commercial enterprise.
OpenAI was founded in 2015 as a nonprofit dedicated to developing artificial general intelligence for the public good. Its founders pledged approximately $1 billion and recruited leading researchers in the field. Musk departed from the organization in 2018. The following year, OpenAI adopted a capped for-profit structure that permitted investor returns up to a specified limit, a change the organization says was necessary to compete in an increasingly capital-intensive industry. OpenAI is now pursuing a conversion to a public-benefit corporation, a structure that would eliminate the existing profit cap.
Musk’s Claims and the Defendants’ Response
Musk filed suit in the United States District Court for the Northern District of California against Altman, Brockman, OpenAI, Microsoft, and related entities. He asserted claims both individually and derivatively on behalf of OpenAI. Among other relief, Musk sought an order requiring OpenAI to honor what he characterizes as commitments to remain a nonprofit organization, conduct leading AI research for the benefit of humanity, and make its technology broadly available.
Musk alleged that he played a critical role in OpenAI’s formation and development, contributing more than $44 million in cash between 2015 and 2020. His amended complaint asserted 26 causes of action, including federal civil RICO claims, breach of charitable trust, fraud, false advertising, self-dealing, unjust enrichment, and breach of contract.
The defendants offered a sharply different account. Their response alleged that Musk’s involvement with OpenAI ended after he unsuccessfully sought greater control over the organization and proposed integrating it with Tesla. According to the defendants, Musk later became hostile to OpenAI’s success after leaving the organization and eventually launched a competing AI venture. They further contended that Musk’s lawsuit was motivated by opposition to OpenAI’s proposed restructuring. The defendants asserted numerous defenses, but one ultimately proved decisive: that the relevant claims were untimely under the applicable statute of limitations.
The Advisory Jury’s Verdict
The advisory jury was asked to answer two questions: whether Musk’s breach-of-charitable-trust claim and unjust-enrichment claim were barred by the statute of limitations. The jury unanimously answered both questions in the affirmative, concluding that Musk’s alleged injuries arose more than three years before he filed suit.
Unlike a traditional jury verdict, however, the advisory jury’s findings were not binding. Advisory juries remain relatively uncommon but have appeared in several significant technology cases. Judge Gonzalez Rogers has previously described them as useful tools for addressing complex disputes that present both legal and broader public-policy considerations.
After reviewing the evidence and the advisory verdict, Judge Gonzalez Rogers agreed that Musk’s claims were time-barred and dismissed them. As a result, the case ended without a determination on the substantive merits of Musk’s allegations.
What’s Next?
The dispute is unlikely to end here. Following the ruling, Musk announced on X that he intends to appeal to the United States Court of Appeals for the Ninth Circuit. He argued that the decision turned on a procedural limitations issue rather than the underlying merits of the dispute. Whether the Ninth Circuit will revive any portion of the case remains to be seen.
For now, the decision represents a significant victory for OpenAI and its leadership. It also underscores a recurring lesson in complex business litigation: even claims involving some of the world’s most prominent technology leaders can rise or fall on procedural defenses such as the statute of limitations.
The Firm is grateful to its summer clerk, Jaleel Gilmore, for his contributions to this article.
