Elon Musk’s 2015 donation of $100 million to OpenAI wasn’t a vanity play. It came with terms—verbal ones, his lawyers argue—that OpenAI would remain a nonprofit dedicated to AI safety first, profits never. Now, five years after the 2025 restructuring that created OpenAI Public Benefit Corporation and handed control to Altman and Greg Brockman, Musk is demanding $134 billion in damages and the undoing of that deal. On May 16, 2026, inside a hushed Delaware courtroom, two visions of artificial intelligence’s future collided: one where power is concentrated in the hands of a single visionary, the other where it’s managed by a hybrid entity accountable to no one man. The jury will begin deliberating Monday, May 19. And what they decide could reshape not just OpenAI’s path to a rumored $1 trillion IPO, but the entire framework of how AI safety is governed in a world racing toward AGI.
Key Takeaways
- Elon Musk is seeking $134 billion in damages and the reversal of OpenAI’s 2025 for-profit restructuring.
- Sam Altman testified that Musk wanted control of OpenAI to pass to his children after death—an assertion Musk’s team called “absurd.”
- OpenAI’s defense hinges on the argument that the organization remains committed to AI safety, despite its for-profit arm.
- The jury’s advisory verdict is non-binding; the final decision rests with Judge Maryellen Noreika.
- A ruling for Musk could derail OpenAI’s IPO and benefit xAI, Musk’s AI firm set to merge with SpaceX in June at a $1.75 trillion valuation.
Musk’s Case: A Betrayal of AI Safety?
It’s not every day a tech founder sues his former cofounders over a broken handshake. But that’s essentially what Musk’s legal team is claiming: that in 2015, when OpenAI was founded, there was a clear agreement—OpenAI would be a nonprofit, and any commercial arm would serve the mission of advancing AI safety, not enriching executives. Steven Molo, Musk’s attorney, hammered this point during closing arguments on May 16, 2026, projecting side-by-side mugshot-style images of Musk and Altman on a courtroom screen. “One man stayed true to the mission,” Molo said. “The other chose power.”
Molo argued that the 2025 restructuring—a move that converted OpenAI’s subsidiary into a public benefit corporation—violated Musk’s understanding of the original agreement. There was no formal contract, no signed document. But, Molo insisted, the promise was real. And when Musk discovered in 2024 that Altman and Brockman had secured massive equity stakes and aligned closely with Microsoft, he felt betrayed. “He didn’t sue because he lost money,” Molo said. “He sued because he lost faith in the mission.”
And the stakes aren’t small. Musk isn’t asking for a slap on the wrist. He wants the court to unwind the entire structure, remove Altman and Brockman from leadership, and redirect up to $134 billion in damages—funds he says should go to OpenAI’s nonprofit arm. That number isn’t arbitrary. It’s based on projected valuations of the for-profit entity as it nears an IPO.
The Donkey Trophy Defense
OpenAI’s lawyers didn’t just counter the allegations—they leaned into the absurdity. During their closing, Sarah Eddy brought out a physical prop: a golden trophy shaped like a donkey’s ass. It had been gifted to an OpenAI employee in 2024 after he was called a “jackass” for resisting internal pressure to accelerate AGI development at the expense of safety protocols. “This trophy,” Eddy said, “is proof that OpenAI employees are encouraged to push back on reckless timelines. That’s not the culture of a company chasing profit. That’s the culture of one protecting AI safety.”
The room fell quiet. It was bizarre. It was memorable. And it underscored a central theme of OpenAI’s defense: that despite the corporate restructuring, the organization hasn’t abandoned its principles. The move to a public benefit corporation, Eddy argued, was never about greed. It was about survival. “You can’t compete with Google and Meta on research if you’re fundraising like a charity,” she said. “But you can build guardrails. And we did.”
Altman’s Counter: Musk the Control Freak
Sam Altman didn’t hold back on the stand. When grilled about his credibility—his lawyers noted past controversies over transparency and executive decisions—he pivoted hard. This wasn’t about him, he said. It was about Musk. And Musk’s real motive: control. “In 2017,” Altman testified, “when we were discussing a for-profit arm, I asked Elon how he’d handle succession. His answer? ‘Maybe the control of OpenAI should pass to my children.’”
The courtroom buzzed. That quote, reported by MIT Tech Review, landed like a punch. It painted Musk not as a principled founder but as a would-be AI monarch. And Altman’s team ran with it. They framed Musk’s lawsuit as less about mission fidelity and more about sour grapes—especially given that Musk launched xAI in 2023, a direct competitor to OpenAI.
OpenAI’s lawyer, Sarah Eddy, drove the point home: “If Musk cared so deeply about AI safety, why didn’t he sue in 2025? Why wait until 2026, after xAI began gaining traction? The timing isn’t coincidence. It’s sabotage.”
What the Restructuring Actually Changed
To understand the core dispute, you have to look at what the 2025 restructuring actually did. OpenAI didn’t dissolve its nonprofit. It still exists as the parent entity. But the operating arm—the one developing GPT models, hiring engineers, and signing billion-dollar deals with Microsoft—became a public benefit corporation. That structure allows profit generation while legally obligating the company to serve a broader social good. Altman and Brockman retained significant equity, though capped at 20% combined. Microsoft holds a 49% stake. The nonprofit retains the right to appoint the board and veto certain decisions.
But Musk’s team argues that this setup gutted the original promise. “A nonprofit with a for-profit master isn’t a safeguard,” Molo said. “It’s a puppet.”
- OpenAI nonprofit remains the parent entity
- Operating arm is a public benefit corporation
- Altman and Brockman capped at 20% equity combined
- Microsoft holds 49% stake
- Nonprofit board retains veto power over key decisions
The xAI Factor: A Conflict of Interest?
Here’s what no one’s talking about enough: timing. Musk launched xAI in 2023. It’s small. Ambitious. Under-resourced compared to OpenAI—until now. In a surprise announcement on May 10, 2026, Musk revealed that xAI would merge with SpaceX and go public as part of that entity in June, targeting a $1.75 trillion valuation. That’s not just bold. It’s audacious. And it raises a question: Is Musk suing OpenAI to save a mission—or to weaken a rival?
OpenAI’s defense leans heavily on this angle. They don’t deny Musk’s early role. They don’t dispute his donation. But they do challenge his narrative. “He left OpenAI in 2018,” Eddy reminded the jury. “He hasn’t been involved in safety reviews, governance, or technical direction for eight years. Now he wants to dismantle the company from the outside?”
Musk’s team counters that his absence doesn’t invalidate his claims. “You don’t lose standing because you walked away from a sinking ship,” Molo said. But the optics are rough. Musk wants to unwind a structure that, if dismantled, could delay or kill OpenAI’s IPO. And he’s doing it months before his own AI venture goes public. That’s not just coincidence. It’s context.
What This Means For You
If you’re building AI tools, launching a startup, or working at a research lab, this trial isn’t just drama. It’s a warning. The legal foundation of your company’s mission matters. Verbal agreements don’t hold up in court. Governance structures—especially around control, equity, and mission drift—are now under scrutiny. If your team shifts from nonprofit to hybrid, you’d better document why. And you’d better prove it’s not just about money.
For developers, the takeaway is clear: the code you write today may be used in ways you didn’t anticipate. And the leadership you trust might not be held accountable unless the guardrails are built into the charter, not just the culture. OpenAI’s donkey trophy is a joke, sure. But it’s also a symbol. Culture fades. Paper doesn’t.
What happens if Musk wins? The implications are staggering. OpenAI’s IPO could collapse. Microsoft might pull back. Talent could flee. But if he loses, it sets a precedent: founders can pivot, scale, and even profit—as long as they pay lip service to AI safety. Neither outcome feels clean. Neither feels safe.
Can an AI company ever truly serve humanity when its leaders are worth billions the moment it goes public?
Sources: MIT Tech Review, The Information
