Elon Musk Seeks Up to $134 Billion in Damages from OpenAI and Microsoft in Ongoing Lawsuit

 

SAN FRANCISCO – Elon Musk, the CEO of Tesla and xAI, has escalated his long-running legal battle against OpenAI, demanding between $79 billion and $134 billion in damages from the AI company and its major partner, Microsoft. The claim, detailed in a recent court filing, accuses OpenAI of fraudulently abandoning its original nonprofit mission and reaping massive “wrongful gains” from Musk’s early contributions.

The lawsuit, originally filed in 2024 and now heading to a jury trial starting April 27, 2026, in Oakland, California, centers on allegations that OpenAI misled Musk when he co-founded the organization in 2015. Musk provided approximately $38 million in seed funding and significant technical and reputational support, viewing OpenAI as a nonprofit dedicated to safe artificial general intelligence (AGI) development for humanity’s benefit. However, OpenAI transitioned to a capped-profit model and forged a deep partnership with Microsoft, which has invested billions and holds a substantial stake.

Musk’s legal team argues that without his involvement, OpenAI would not exist in its current form. They cite an expert witness, financial economist C. Paul Wazzan, who calculated that Musk is entitled to a portion of OpenAI’s estimated $500 billion valuation. The damages breakdown includes $65.5 billion to $109.4 billion from OpenAI and $13.3 billion to $25.1 billion from Microsoft, potentially plus punitive measures.

A U.S. District Judge Yvonne Gonzalez Rogers recently rejected OpenAI and Microsoft’s final attempts to dismiss the case, ruling there was sufficient evidence for a jury to decide on credibility and claims. The judge noted the trial would hinge on witness testimony and evidence from unsealed documents, including depositions from key figures like Sam Altman, Greg Brockman, Ilya Sutskever, and Microsoft CEO Satya Nadella.

OpenAI has fiercely denied the allegations, describing the lawsuit as part of Musk’s “ongoing pattern of harassment” to advantage his competing AI venture, xAI. In a January 2026 blog post titled “The truth Elon left out,” OpenAI accused Musk of cherry-picking evidence from internal records, including Greg Brockman’s private journal entries. The company claims Musk himself supported transitioning to a for-profit structure in 2017 to attract necessary capital, but left after failing to secure majority control or merge OpenAI with Tesla. OpenAI maintains that Musk agreed to a hybrid model and only objected once his influence waned.

Microsoft has similarly pushed back, with lawyers stating there is no evidence it “aided and abetted” any wrongdoing. Both defendants have challenged Musk’s damages calculations as unreliable and “unserious,” warning they could mislead jurors.

The case has drawn intense attention amid the booming AI industry, where OpenAI’s valuation has soared thanks to tools like ChatGPT. Musk, who left OpenAI’s board in 2018 citing conflicts with Tesla’s AI efforts, has repeatedly criticized the company publicly, calling its shift a betrayal of its founding principles.

Musk’s lawyer, Steven Molo, emphasized in a statement: “Without Elon Musk, there’d be no OpenAI. He provided the bulk of the seed funding, lent his reputation, and taught them all he knows about scaling a business.”

As the trial approaches, the dispute highlights deeper tensions in AI governance, competition, and the balance between nonprofit ideals and commercial realities. Observers note that even a fraction of the demanded amount would represent a massive financial hit to OpenAI and Microsoft, while reinforcing Musk’s aggressive stance in the race for AI dominance.

The outcome could influence future AI investments, partnerships, and how early backers’ contributions are valued in rapidly scaling tech ventures. Both sides remain firm, with Musk posting on X that he “can’t wait to start the trial,” predicting explosive revelations from discovery and testimony.