The Chief Executive of Microsoft, Satya Nadella, is expected to testify on Monday in a federal court in Oakland, California, as part of Elon Musk’s high-profile lawsuit against OpenAI. The testimony will focus on internal emails detailing how Microsoft funded OpenAI’s transition from a philanthropic organisation to a for-profit artificial intelligence giant. Nadella’s appearance precedes that of OpenAI Chief Executive Sam Altman, who is scheduled to take the stand later this week in a trial that has exposed deep divisions within Silicon Valley’s elite.
Elon Musk, a co-founder of OpenAI, accuses the company of betraying its original non-profit mission and misappropriating his founding donations, which totalled $38 million. The Tesla and SpaceX owner is seeking a court order to force OpenAI to return to its non-profit status. Such a move could significantly alter the company's standing in the global AI race against competitors such as Google, Anthropic, and China’s Deepseek. OpenAI is currently valued at over $850 billion, a figure Musk claims was built on the back of his initial contributions.
OpenAI has rejected the allegations, arguing that Musk left the organisation voluntarily after failing to secure majority control. The company maintains that the billionaire has since become a direct competitor through his own venture, xAI. An advisory jury is expected to reach a verdict by mid-May, after which Judge Yvonne Gonzalez Rogers will issue a final ruling on liability and potential remedies. If the judge sides with Musk, it could jeopardise OpenAI’s plans for an initial public offering.
Lawyers representing Musk intend to use Microsoft emails from 2018 to argue that the tech giant was aware it was diverting a non-profit foundation from its purpose. In one correspondence, Satya Nadella questioned the research OpenAI was conducting but noted that Musk believed the startup was on the verge of breakthroughs in artificial general intelligence. At the time, Microsoft executives expressed scepticism, with Chief Technology Officer Kevin Scott worrying that OpenAI might partner with Amazon if a deal were not reached.
Following these internal discussions, a cash-strapped OpenAI established a for-profit subsidiary to attract the capital necessary for its survival. Microsoft eventually invested $1 billion in 2019, followed by further injections totalling $13 billion. That stake is now valued at approximately $228 billion, representing a 17-fold return on the initial investment. The trial has already featured intense testimony, including details from the diary of co-founder Greg Brockman, which suggested an early interest in generating personal wealth.
The proceedings have also touched on the volatile relationship between the founders. Brockman testified that Musk physically threatened him in 2017 after being denied absolute control of the organisation. In a separate development, Musk recently announced a partnership between his own firm, SpaceX, and Anthropic, allowing the rival AI firm to use a major data centre. The outcome of the current trial remains a pivotal moment for the future of OpenAI and the broader artificial intelligence industry.
