Musk’s fraud case against OpenAI is headed toward a jury decision after a federal judge said she planned to reject the company’s bid to dismiss the lawsuit, according to remarks made during a Wednesday hearing in Oakland, California.
Without issuing a formal ruling, U.S. District Judge Yvonne Gonzalez Rogers told lawyers in the course of a 90-minute proceeding that she intended to allow the case to move forward, saying: “This case is going to trial,” during an occasionally testy session.
Rogers said she still needed to work out trial logistics, including how the proceedings would be set up. She also indicated that part of the pretrial phase involved evaluating whether to dismiss unjust enrichment allegations Musk has made against Microsoft, which has built a large stake in OpenAI after investing in a for-profit subsidiary created in 2019.
The judge told attorneys that the evidence was sufficient for a jury to consider the core fraud dispute, framing the matter as a contest in which jurors would weigh who they believe and the credibility of witnesses who would be called to testify under oath if the trial proceeds. She added: “Part of this is about whether a jury believes the people who will testify and whether they are credible,” according to her remarks.
The lawsuit, filed against OpenAI in 2015 by Musk and later pursued for more than a year before Rogers’ latest ruling indication, revolves around OpenAI’s founding as a nonprofit research lab, and the founders’ stated intent that the work would primarily benefit humanity. Musk and OpenAI CEO Sam Altman launched the lab with that mission, according to the case description presented in court, with Musk later contending that the nonprofit purpose was misrepresented during OpenAI’s evolution into a capitalistic enterprise valued at $500 billion.
According to evidence presented so far, Musk contributed $40 million to OpenAI, mostly routed through donor-advised funds he had set up, and provided four Tesla vehicles. The filings cited by Rogers describe a later break between Musk and Altman, with Musk asserting that he began suspecting Altman and another OpenAI executive, Greg Brockman, were planning to convert the research lab into a profit-seeking company.
Rogers’ comments also drew on a 2017 diary entry by Brockman. In that entry, Brockman wrote about wanting to become a billionaire and about switching to a for-profit structure, stating, “We’ve been thinking that maybe we should just flip to a for profit. Making the money for us sounds great and all,” according to court filings cited by the judge.
Musk ultimately cut ties with OpenAI and later launched a rival company, xAI, after what the evidence described as a falling out. The judge’s rationale for allowing Musk’s lawsuit to move toward a jury decision also referenced that OpenAI’s board had previously considered removing Altman in 2023 before bringing him back as CEO, with Microsoft’s role in that return described in the case narrative.
One key issue the court indicated it would have to address before Musk could proceed with fraud claims at trial is pinpointing when the alleged deceit occurred. Rogers noted there is a three-year statute of limitations for Musk’s fraud allegations, and suggested the jury would be the first to decide when the suspected misleading conduct began. The trial’s fraud phase, she indicated, would then depend on whether the alleged deception started less than three years before Musk filed his lawsuit in August 2024.
If and when a trial date is set, the proceedings would likely require testimony from both Musk and Altman under oath, with jurors weighing their credibility as part of the legal showdown over what Musk says OpenAI represented during the company’s transition.
The judge did not say when the trial would be scheduled.