Elon Musk expands legal fight against ChatGPT-maker OpenAI, adds Microsoft as defendant

Billionaire entrepreneur Elon Musk has escalated his legal challenge against OpenAI, the maker of ChatGPT, by filing an expanded lawsuit that now includes OpenAI’s largest financial backer, Microsoft. The amended complaint, submitted late Thursday in a federal court in Oakland, California, alleges that OpenAI and Microsoft are illegally working to monopolise the generative AI market and stifle competition.

The updated lawsuit accuses the two tech giants of violating federal antitrust laws by requiring exclusivity agreements that prevent rivals from accessing the generative AI market. Musk’s filing also argues that Microsoft’s partnership with OpenAI, including its exclusive licensing agreements, essentially acts as a merger without proper regulatory oversight.

“Never before has a corporation gone from tax-exempt charity to a $157 billion for-profit, market-paralysing gorgon — and in just eight years,” the complaint states. Musk is seeking to void OpenAI’s licensing agreements with Microsoft and force the companies to divest profits he claims were “ill-gotten.”

"Microsoft’s anticompetitive practices have escalated," Musk's attorney Marc Toberoff said in a statement. "Sunlight is the best disinfectant."

Musk, who co-founded OpenAI in 2015, has had a contentious relationship with the organisation since stepping away from its board in 2018. He has frequently criticised OpenAI for what he describes as prioritising profits over public good. OpenAI, which has gained widespread attention for its ChatGPT platform, is now a key player in the generative AI space, largely fueled by billions of dollars in funding from Microsoft.

Musk’s latest legal filing also comes as he gains prominence as part of U.S. President-elect Donald Trump’s administration. Musk has been named to a newly created role focused on cutting government waste, following his financial support for Trump’s campaign.

The feud between Musk and OpenAI has grown increasingly heated, with OpenAI alleging in a previous court filing that Musk is using the lawsuit as part of a “blusterous campaign to harass OpenAI for his own competitive advantage.”