Ex-OpenAI employees back Elon Musk’s legal bid to halt Sam Altman's for-profit transition plan

In a fresh twist to the escalating legal drama between Elon Musk and OpenAI, a group of 12 former OpenAI employees have formally backed the Tesla CEO’s lawsuit against the artificial intelligence lab, raising red flags over the startup’s shift from nonprofit to for-profit ambitions.

The group represented by Harvard law professor Lawrence Lessig filed a legal brief in a California district court on Friday, arguing that OpenAI’s corporate restructuring would betray its founding mission and stakeholders’ trust.

“If the OpenAI Nonprofit agreed to a change in the OpenAI corporate structure which took away its controlling role, that would fundamentally violate its mission,” the filing stated.

The individuals who worked at OpenAI between 2018 and 2024 said they witnessed the evolution of the company from its early nonprofit days to its current commercially driven trajectory. They include former researchers, engineers, and ethics advisors such as Richard Ngo, William Saunders, Gretchen Krueger, and Jeffrey Wu, many of whom have been publicly critical of OpenAI’s direction in recent months.

The filing argues that OpenAI’s proposed shift to a for-profit structure would “breach the trust” of employees, donors, and supporters who contributed on the premise of its nonprofit ideals.

Musk, who co-founded OpenAI in 2015 with the goal of developing AI “for the benefit of humanity,” has emerged as the company’s most vocal critic. He has accused OpenAI, now led by CEO Sam Altman, of abandoning its founding values in favour of aggressive monetisation, especially following the viral success of ChatGPT in late 2022.

In a bid to regain influence, Musk led a $97.4 billion takeover proposal in February, which OpenAI swiftly rejected. The company recently completed a $40 billion funding round at a staggering $300 billion valuation, led by SoftBank, the largest private funding raise in tech history.

OpenAI’s current structure consists of a capped-profit limited partnership overseen by the original nonprofit. The proposed spin-off would fully transition the for-profit arm into a Public Benefit Corporation, akin to rival labs like Anthropic.

The legal battle continues to intensify. OpenAI recently countersued Musk, alleging a pattern of harassment and accusing him of using “every tool available to harm OpenAI.

Meanwhile, Musk’s core argument that OpenAI’s nonprofit parent has relinquished meaningful control lies at the heart of his attempt to block the company’s transformation.