Sam Altman, the chief executive of OpenAI, testified in court Thursday that Elon Musk demanded 90 percent ownership of the artificial intelligence startup during early negotiations. The revelation, made public as part of an ongoing legal battle, threatens to shake investor confidence and may force a broader rethinking of how AI companies are governed.
What the testimony revealed
Altman’s account, delivered under oath, centers on Musk’s push for near-total control of OpenAI before the company shifted from a nonprofit structure to its current capped-profit model. The demand, Altman said, came at a time when the organization was still in its formative stages and had not yet secured the funding that later turned it into a multibillion-dollar enterprise. Musk, a co-founder who later left the board in 2018, has not publicly disputed the claim, but his legal team has questioned the timing and context of the negotiations.
Investor confidence on the line
The trial revelations land at a sensitive moment for the AI sector. Venture capital firms and institutional investors have poured tens of billions into startups like OpenAI, betting that the technology will transform industries. A public airing of internal power struggles — especially one involving a figure as prominent as Musk — could make some backers nervous. If investors begin to doubt that governance at these companies is stable, fundraising may become harder for the entire field. The case is already being watched closely by Silicon Valley law firms that advise startups on board structures and equity splits.
A test for nonprofit conversions
OpenAI’s transition from a nonprofit to a so-called capped-profit entity in 2019 set a precedent for other AI labs that wanted to attract outside capital without abandoning their original missions. Altman’s testimony could reshape that precedent. If the court finds that the founders acted properly, the path may remain open. But if the ruling casts doubt on the fairness of the original negotiations, regulators and future investors may demand stricter oversight of any future conversion. Several other AI startups are reportedly considering similar structural changes, and they will be watching the outcome closely.
What comes next
The trial is expected to continue for several more weeks. The judge has not yet set a date for a final ruling. Whether the court finds Musk’s demand unreasonable — or finds that Altman and the board handled the negotiations properly — could determine how other AI companies navigate the tricky shift from nonprofit to for-profit. For now, the testimony has put a spotlight on the personal tensions that shaped one of the most valuable startups in the world.
