Sam Altman defends OpenAI in courtroom showdown with Elon Musk

The OpenAI CEO, Sam Altman, took the stand on Tuesday to defend himself and his company against a lawsuit by Elon Musk. Altman is set to be one of the final witnesses in the trial, which has pitted two of the tech industry’s most powerful men against each other in a dramatic courtroom showdown.

Musk has accused Altman and OpenAI of breaking the AI firm’s founding agreement by restructuring it into a for-profit enterprise, alleging that Altman essentially swindled him into co-founding the company and providing tens of millions in financial backing. Musk also claims Altman unjustly enriched himself in the process and is seeking the CEO’s removal from OpenAI, the redistribution of $134bn to the firm’s non-profit and the undoing of its for-profit conversion.

OpenAI and Altman have rejected all of Musk’s claims, arguing that he is motivated by jealousy after a failed bid to take over the AI firm in 2018 and a subsequent departure from its board. They argue that Musk was also always aware of plans to create a for-profit structure and that OpenAI’s non-profit still oversees the for-profit business.

The most influential man in AI takes the stand

Altman’s testimony is one of the marquee moments of the three-week long trial, which has featured some of the biggest names in Silicon Valley, including Musk and Microsoft’s CEO. The outcome of the case is hugely important for OpenAI, which is seeking to go public at around a $1tn valuation later this year. In the bitter feud between Musk and Altman, the reputational stakes are winner-takes-all.

When Altman took the stand just before 9am local time in the Oakland, California federal courthouse, he began by recapping some of his career in tech before addressing some of Musk’s allegations directly.

“You, as you know, have been accused of stealing a charity,” OpenAI’s lawyer asked Altman. “What is your response to that?

“It feels difficult to even wrap my head around that framing,” Altman responded. “We created the largest or one of the largest charities in the world.”

“What would you say to the suggestion that OpenAI was Mr Musk’s startup?” OpenAI’s lawyer asked.

“I would not agree with that characterization at all,” Altman replied.

Altman claimed in his testimony that in 2017 there were discussions at OpenAI of creating a for-profit structure but that they fell through due to disagreements over its ownership. Musk wanted to be CEO of the organization, Altman said. The CEO also alleged that when Musk was asked what would happen to control of the company in the future if he died, the centibillionaire suggested that it could go to his children.

“Mr Musk felt very strongly that if we were going to form a for-profit, he needed total control over it initially,” Altman said, adding that Musk’s request made him “extremely uncomfortable”.

Altman’s testimony framed Musk as an erratic, sometimes vindictive leader while at OpenAI. He claimed that Musk had “demotivated some of our key researchers” through aggressive demands and management techniques such as ranking employees. Altman also claimed that Musk was later offered a chance to invest in OpenAI’s for-profit entity, but that he turned down the opportunity because he refused to invest in companies that he did not control on principle.

At one point in the final moments of his opening testimony, Altman fit in a dig at Musk’s accusation that the OpenAI CEO had “stolen a charity” .

“This whole ‘you can’t steal a charity.’ I agree you can’t steal it. Mr Musk did try to kill it, I guess twice,” Altman said.

Sam Altman: ‘deceptive and a liar’?

Altman’s character and leadership of OpenAI have been a core focus of the trial, with Musk’s lawyers attempting to portray Altman as deceptive and self-serving. Several former OpenAI executives, notably those who were involved in briefly ousting Altman in 2023, have testified during the proceedings that he was untrustworthy and had a pattern of lying. Mira Murati, OpenAI’s former chief technical officer, accused him of “creating chaos”.

Musk’s attorney, Steven Molo, began a combative cross-examination of Altman with a series of questions about whether Altman ever misled former colleagues or investors, asking him if he was a “completely trustworthy” person.

“You’ve repeatedly been called deceptive and a liar by people with whom you’ve done business, right?” Molo asked.

“I have heard people say that,” Altman replied.

Molo read out a list of statements from former OpenAI executives and other coworkers who have suggested that Altman fed them falsehoods or misrepresented himself. Molo also tried to portray Altman as the one bent on control, rather than Musk.

“You had a fixation on this concept of being CEO didn’t you?” Molo asked.

“I don’t agree with that characterization,” Altman replied.

Molo pressed Altman during the cross-examination on his connections to other companies, suggesting potential conflicts of interest, and questioned his dual role on the board of OpenAI’s non-profit and as its CEO. At one point, Molo asked Altman if he would ever fire himself.

Altman largely responded to Molo’s aggressive questioning with short, yes-or-no responses and occasional claims that he did not recall exact details related to the case or disputed the characterization of events. The cross examination was punctuated with frequent objections from OpenAI’s attorney, especially as Molo brought up accusations of Altman being dishonest.

The trial is the culmination of several tumultuous weeks for Altman, who in recent weeks was the target of a molotov cocktail attack at his San Francisco home and was the subject of an unflattering, widely circulated New Yorker profile, which was mentioned at the trial. Musk has also been exposed to embarrassment during the case, with details about his romantic relationship with former OpenAI board member, Shivon Zilis, becoming public and OpenAI president, Greg Brockman, describing Musk throwing a tantrum during a meeting shortly before leaving the company.

The trial is set to hold its closing arguments on Thursday, followed by the nine person jury deliberating whether Altman, Brockman and OpenAI will be held liable.