Elon Musk has raised his legal demand against OpenAI and Microsoft to a range of $79 billion to $134 billion in damages. He says the companies gained that money by abandoning OpenAI’s original nonprofit purpose and turning it into a profit-focused partner for Microsoft.
Massive damages claim built on “wrongful gains”
Musk bases his claim on an expert report that looks at OpenAI’s estimated $500 billion valuation and Microsoft’s financial upside from the partnership, rather than on the cash he originally contributed. He argues that his early funding, technical input, and public backing helped create value that later flowed to OpenAI and Microsoft in ways he says were never supposed to happen under the nonprofit model.
The filing cites analysis by financial economist C. Paul Wazzan. According to court papers, Wazzan estimates that OpenAI gained between $65.50 billion and $109.43 billion tied to Musk’s involvement, with Microsoft gaining another $13.30 billion to $25.06 billion through its stake and commercial use of OpenAI’s technology. Together, those figures lead to the requested disgorgement range of $79 billion to $134 billion. And Musk plans to ask for punitive damages on top of that, which could push his total demand even higher if a jury agrees.
Musk’s lawyer Steven Molo compared the situation to a startup investor whose small initial check can later be worth far more. In the filing, Molo writes: “Just as an early investor in a startup company may realize gains many orders of magnitude greater than the investor’s initial investment, the wrongful gains that OpenAI and Microsoft have earned – and which Mr. Musk is now entitled to disgorge – are much larger than Mr. Musk’s initial contributions”.
From nonprofit lab to Microsoft partner
OpenAI launched in 2015 as a nonprofit research organization. Musk was one of its best-known founders, putting in tens of millions of dollars and lending his name at a time when the group presented itself as focused on safe, open AI for the benefit of humanity.
He left the board in 2018 after internal disagreements and later created his own AI company, xAI, in 2023. Still, he now argues that OpenAI’s later shift to a capped-profit structure and its tight alliance with Microsoft broke core understandings he says existed when he backed the project. Musk’s complaint points to Microsoft’s multibillion-dollar investments, its large economic interest in OpenAI, and its use of OpenAI models in products such as cloud services and Office tools as evidence that the lab’s center of gravity moved into a commercial space he never agreed to fund.
Case headed for jury trial
The new damages request comes just after a key court ruling in Musk’s favor. A federal judge in Oakland, California, recently allowed central parts of his lawsuit to go forward, rejecting efforts by OpenAI and Microsoft to block those claims at an early stage.
US District Judge Yvonne Gonzalez Rogers said Musk had alleged enough facts for a jury to weigh his argument that OpenAI functioned like a charitable trust tied to its original mission and that this commitment was broken when the organization restructured and deepened its commercial ties to Microsoft. Court records indicate that a jury trial is scheduled for late April, which gives both sides limited time to refine their arguments and expert evidence.
Legal observers note that the scale of Musk’s claim adds pressure, but they also point out that disgorgement at this level is difficult to win. The court will need to be convinced not just that OpenAI and Microsoft breached duties, but that the gains Musk targets can be tied closely to his early support and to the alleged misconduct.
OpenAI calls case “baseless” as tensions grow
OpenAI has pushed back hard against Musk’s narrative. In public statements, the company calls the lawsuit “baseless” and says Musk is using litigation to attack a rival now that xAI competes in the same market.
“Mr Musk’s lawsuit continues to be baseless and a part of his ongoing pattern of harassment, and we look forward to demonstrating this at trial,” the company said in a recent statement, arguing that his multibillion-dollar demand is an “unserious” attempt to attract attention. OpenAI has also warned investors to expect more headline-grabbing filings as the trial date approaches. Microsoft has declined to comment on the new damage figures so far.
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