Elon Musk suffers early loss in bid to block OpenAI restructure

A California judge denied Elon Musk's motion Tuesday to issue an injunction forcing OpenAI to stop its conversion from a nonprofit to a for-profit enterprise.

Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California rejected Musk’s four-pronged request for a preliminary injunction in a 16-page order, broadly concluding the tech mogul failed to present enough evidence to warrant an immediate court order blocking OpenAI’s for-profit transition.

The ruling is an initial win for OpenAI and its founder, Sam Altman, in an intensifying feud between two of the most influential players in developing artificial intelligence. But it leaves the door open for Musk to continue his legal crusade against the organization he originally helped found and now directly competes against as head of xAI.

Musk launched the suit against OpenAI in August and expanded his case to add new claims and defendants in November, accusing the company of turning from a “tax-exempt charity” into a “for-profit, market-paralyzing gorgon.” OpenAI responded by releasing emails and private messages from Musk, which the ChatGPT maker touted in a blog post as proof that Musk “not only wanted, but actually created, a for-profit as OpenAl's proposed new structure.”

While rejecting Musk’s request for an injunction, Rogers said the court was prepared to offer an expedited trial as soon as the fall of 2025 “given the public interest at stake,” so long as Musk narrows his case against OpenAI and drops “ancillary claims.”

“Such an approach would be more efficient and address the issues which are allegedly more urgent in terms of public, not private, considerations,” Rogers wrote.

Lawyers representing Musk and a spokesperson for OpenAI did not immediately return requests for comment.

Tuesday’s court ruling comes amid a wider rivalry between the two former collaborators.

Musk and Altman trolled each other in posts to Musk’s social media platform X earlier this year, with the Tesla founder pouring cold water on the landmark $500 billion Stargate data center deal that Altman announced from the White House in January in partnership with Oracle, SoftBank and MGX.

“They don’t actually have the money,” Musk wrote, prompting Altman to reply, “i realize what is great for the country isn’t always what’s optimal for your companies, but in your new role i hope you’ll mostly put 🇺🇸 first.”

Last month, Musk offered an unsolicited bid for the nonprofit that controls OpenAI. Altman responded with a firm “no thank you” and offered to buy X instead.