Elon Musk drops lawsuit against OpenAI ahead of key court hearing

Elon Musk has unexpectedly withdrawn his breach of contract lawsuit against OpenAI, just one day before a California judge was set to hear OpenAI's request for dismissal.

The lawsuit, originally filed in February, accused OpenAI co-founders Sam Altman and Greg Brockman of abandoning the company's non-profit roots in favor of profit-driven motives.

Musk's 35-page complaint alleged that OpenAI had transformed into a "closed-source de facto subsidiary" of Microsoft, which has invested $13 billion and holds a 49 percent stake in the AI company. Microsoft employs OpenAI's technology to power its generative AI tools, such as Copilot, which are integrated into products like Windows and Office.

OpenAI argued for the dismissal, suggesting Musk might use the lawsuit to gain access to proprietary records and technology. They also claimed there was no founding agreement for them to breach. Neither OpenAI nor Musk's lawyer, Alex Spiro, responded to requests for comment.

Musk, a co-founder of OpenAI in 2015, left the company three years later due to disagreements over its direction. He now runs xAI, an AI startup that recently raised $6 billion and developed Grok, a ChatGPT rival integrated into X for paid users.