California’s attorney general has opted not to support Elon Musk’s legal action against OpenAI, stating in a newly revealed letter that the lawsuit fails to demonstrate any clear benefit to the public interest of the state.
Musk, who co-founded OpenAI and is now locked in a high-profile dispute with current CEO Sam Altman, had requested the AG’s office to join his lawsuit. The tech mogul argues that OpenAI’s move to restructure its nonprofit governance in favor of investor equity threatens the company’s original mission. However, in a letter dated Monday, the AG's office pushed back, saying Musk hadn’t provided compelling justification and appeared more focused on gaining influence over OpenAI’s charitable assets.
The rift between Musk and OpenAI deepened earlier this year when a consortium led by Musk made an unsolicited $97 billion offer to take control of the company. Musk’s legal team insists the offer was contingent on structural changes and not an attempt to profit from OpenAI in its current nonprofit form. In a response sent Tuesday, Musk’s attorneys accused the attorney general of misinterpreting his intentions, and emphasized that other voices—including ex-OpenAI staff and philanthropic leaders—also oppose the nonprofit’s transition.
Despite declining to join the lawsuit, California’s attorney general remains a key player in the unfolding drama. As OpenAI is a California-based nonprofit, any governance overhaul must be cleared by the state’s nonprofit regulator.
OpenAI, for its part, argues that relinquishing nonprofit control is necessary to raise capital—specifically, to close a $40 billion funding round by year’s end. The company says the nonprofit will still retain an equity stake, which will appreciate in value and continue to support its mission.
Founded in 2015 by Musk and Altman, OpenAI has since become a leader in artificial intelligence. Musk stepped away before its rise to prominence and now claims the company has veered away from its original commitment to advancing AI for public good, not profit. He filed suit against OpenAI and Altman last year, accusing them of abandoning their founding principles.
OpenAI and Altman have denied the claims, and both sides are now on track for a jury trial slated for spring 2026. Meanwhile, Musk has launched his own rival AI venture, xAI, which Altman alleges Musk is using to undercut OpenAI’s progress.