US federal court dismisses Elon Musk's lawsuit against OpenAI and Sam Altman

Kit Pulliam Sat, May 23, 2026 at 3:35 AM PDT 5 min read

Elon Musk has endured a string of court losses this year. His latest defeat also marks the bitter end of a long-running saga with his former business partner, OpenAI co-founder and rival AI developer Sam Altman.

The world’s richest man had his lawsuit against OpenAI thrown out. He alleged that Altman, among other defendants, breached a contract with him by pivoting OpenAI from a nonprofit to a for-profit company.

“It is not OK to steal a charity,” Musk said.

Musk and Altman once served as co-chairs of OpenAI, back when it was still a nonprofit organization. They announced their partnership in 2015; by the end of 2017, Musk had pulled funding for the project.

In his now-defeated lawsuit, Musk sought $150 billion in damages — and specifically demanded that Altman be removed from the OpenAI board.

Here is how their relationship unraveled, how that affected the court case, and what Musk’s next steps are likely to be.

Musk Left OpenAI Because of an Unsuccessful Power Play

Musk and Altman founded OpenAI with a single goal: to create a safe artificial intelligence lab. But it did not take long for Musk to develop another objective — taking over the organization.

During the trial, Musk said he was a key part of OpenAI’s initial success.

“I came up with the idea, the name, recruited the key people, taught them everything I know, provided all the initial funding,” he said.

Musk wanted more control than he was initially given. In 2017, when OpenAI was struggling with funding and considering converting into a for-profit company, Musk demanded as much as 90% ownership — something Altman and other OpenAI founders opposed, fearing he would become a “dictator.”

In September 2017, Musk officially withdrew funding from OpenAI.

“Guys, I’ve had enough. This is the final straw,” he wrote in an email to Altman and two other OpenAI co-founders. “Either go do something on your own or continue with OpenAI as a nonprofit. I will no longer fund OpenAI until you have made a firm commitment to stay or I’m just being a fool who is essentially providing free funding for you to create a startup.”

Musk later suggested incorporating OpenAI into Tesla, which would give him control over the company while providing much-needed funding. Altman declined and instead secured funding from Microsoft.

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