Background

Elon Musk, along with a consortium of investors, recently made a $97.4 billion offer to buy OpenAI, a company founded as a nonprofit in 2015. OpenAI has plans to shift to a for-profit public benefit corporation, which would change its structure but still allow a nonprofit arm to exist.

Musk filed a lawsuit against OpenAI, alleging that the company's planned conversion violates antitrust law and that OpenAI and its investor Microsoft engaged in anti-competitive behavior. Musk claimed that OpenAI and Microsoft had an agreement to avoid investing in competitors, but the court found that this claim was not supported by evidence.

Court Ruling

The court denied Musk's request for an injunction to block OpenAI's conversion, stating that Musk had not demonstrated a likelihood of success on the merits of the case. The court also noted that the question of OpenAI's for-profit conversion can be addressed in a trial set for fall 2025, but that other claims in the lawsuit would need to be stayed.

The court's ruling is a significant setback for Musk, who had sought to prevent OpenAI's conversion and potentially gain control of the company. The case is likely to continue for several years, with the potential for further appeals and legal challenges.