Musk asks state AGs to auction off OpenAI stake in nonprofit ...
Elon Musk is engaging in lawfare, according to a statement from an OpenAI spokesperson. The startup announced that the valuation of its charitable assets will be assessed by independent financial advisors. A report by the Financial Times highlighted these developments.
OpenAI's Background
Sam Altman, along with Musk and others, co-founded OpenAI. The launch of the artificial intelligence tool ChatGPT in 2022 propelled Altman to fame in the technology industry. With backing from Microsoft (MSFT.O), OpenAI achieved a valuation of $157 billion in October, following a substantial $6.6 billion investment.
Corporate Restructuring
OpenAI disclosed plans to restructure its corporate setup in September, aiming to separate its for-profit activities from non-profit governance. A detailed strategy was unveiled in December, outlining the formation of a public benefit corporation. This move was designed to facilitate access to additional capital, potentially making OpenAI one of the most well-funded non-profits in history.
Legal Battles
Musk, the owner of AI startup xAI, initiated legal action against OpenAI to halt its conversion process. Musk contended that the transition contradicted the original mission he supported the company on. A court ruling on Musk's injunction request is expected later this month.
State Involvement
The case attracted attention from Delaware Attorney General Kathy Jennings, who submitted an amicus brief to the court on 29 December. Jennings confirmed ongoing scrutiny of OpenAI's proposed changes. Meanwhile, California Attorney General Rob Bonta, who holds jurisdiction, has not publicly commented on the matter, despite a plea from Meta urging intervention.
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