Elon Musk's lawyer has called on the attorneys general of California and Delaware to force OpenAI, the developer of ChatGPT, to auction off a large stake in its business. They write about it Financial Times and Reuters with references to sources.
Musk's lawyer, Mark Toberoff, said he was writing on behalf of major AI investors who want to participate in an open competitive bidding process for a stake in OpenAI. However, according to the media, OpenAI did not plan to hold such an auction, and Musk's side simply "wants more chaos."
Musk co-founded OpenAI in 2015 and was the company's "most significant" early backer before leaving its board in 2018 after falling out with CEO Sam Altman.
A year later, OpenAI launched a commercial subsidiary to attract outside capital, including more than $13 billion from Microsoft. Yes, the non-profit organization, along with employees and investors, currently owns this commercial "daughter".
Currently, OpenAI wants to change its corporate structure so that its commercial business is independent from non-commercial control. OpenAI's current for-profit unit is slated to become a PBC, while the nonprofit will retain a "significant interest" in the form of shares, the value of which will be determined by independent financial advisors.
The PBC will oversee OpenAI's operations and business, while the non-profit organization will "engage in philanthropic initiatives in sectors such as healthcare, education and science."
According to media reports, Musk's lawyer has pushed attorneys general to allow outside investors to bid for the nonprofit's stake in OpenAI. If successful, this could allow an outside investor to take a significant position in and control of the startup.
We will remind, in 2023, Musk founded his own AI startup — xAI. He recently stepped up efforts to disrupt the OpenAI transformation. In particular, in November he tried to block the process by filing a request for a preliminary injunction in California. Musk claimed that the company was deviating from its mission. And the use of its early donations by OpenAI and Microsoft to create a profitable monopoly will affect xAI.
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