A growing coalition joins Elon Musk’s war on OpenAI (2025)

A group of legal scholars, AI researchers and tech industry watchdogs publicly joined the chorus opposing OpenAI’s plans to restructure late Tuesday, sending its board a copy of a letter sent privately last week to the attorneys general of California and Delaware. The letter asked the state officials to block OpenAI’s move, arguing it would remove a powerful technology from the oversight of its nonprofit board that is tasked with benefiting humanity, not chasing profits.

Earlier this month, California Attorney General Rob Bonta received a request to halt and investigate OpenAI’s transition plan from a group of more than 50 nonprofits including faith, labor and community groups. California’s attorney general must sign-off on any plan to turn a nonprofit into a for-profit company in the state if it has significant assets.

Musk’s attempt to stop OpenAI restructuring is playing out in federal court after the billionaire, a co-founder of the company who later split with the AI developer, filed suit last year. A group of 12 former OpenAI employees filed a proposed amicus brief in support of Musk this month. The case is expected to go to trial in coming months.

The nonprofits and individuals asking state officials to intervene are not formally allied with Musk, who has publicly sparred with OpenAI CEO Sam Altman and founded a rival AI developer called xAI.

However, their arguments have similarities to some made by Musk in court filings, in which he has said OpenAI should not be permitted to abandon its founding mission to benefit humanity.

Giving a for-profit company full control of OpenAI’s technology could incentivize it to prioritize profits over making sure its technology is safe, said Tyler Whitmer, the head of Legal Advocates for Safe Science and Technology, and an organizer of the letter sent to the company’s board on Tuesday.

“There are a lot of people who are really concerned about this restructuring who have no love for Musk and certainly don’t see themselves as allied with him,” Whitmer said. “Taking this directly to the attorneys general pulls it out of the context of that court case and puts it in front of people who currently have enforcement power over charities like OpenAI.”

Other signatories of the letter include 10 former OpenAI employees and experts in corporate governance from prominent universities, including Harvard and Columbia.

Jason Deutrom, a spokesperson for OpenAI, said the company is not abandoning its founding purpose.

“Our Board has been very clear: our nonprofit will be strengthened and any changes to our existing structure would be in service of ensuring the broader public can benefit from AI,” he said. “This structure will continue to ensure that as the for-profit succeeds and grows, so too does the nonprofit, enabling us to achieve the mission.”

The Washington Post has a content partnership with OpenAI.

OpenAI was founded as a nonprofit organization in 2015 with a charter that says its mission is to develop AI capable of human tasks and ensure that the technology benefits humanity as a whole.

It is now among the handful of companies at the forefront of AI and says that to win the investment needed to keep up with rivals such as Google and Meta, it must split off development of OpenAI’s technology from the original nonprofit and the oversight of its board.

The restructuring plan would see OpenAI transfer some of its significant resources to the newly independent nonprofit, which executives say will still seek to use AI to benefit humanity. “Our plan would result in one of the best resourced non-profits in history,” OpenAI said in a December blog post outlining the restructuring plan.

Opponents say control over OpenAI’s tech is so valuable that splitting it from the nonprofit amounts to ripping away potentially billions of dollars of value from an organization pledged to serve the public.

Letting OpenAI execute its restructuring plan would set a dangerous precedent for other nonprofits, said Michael Dorff, a corporate law professor at UCLA who signed the letter sent to OpenAI’s board on Tuesday.

“If those rules break under the influence of a sufficiently large profit incentive, the resulting precedent will not be limited to OpenAI,” he said. “Donors will no longer be able to trust that their gifts to charities will be used for their intended purposes, and the entire system of charitable giving may fall apart.”

In response to a request for comment from The Post, an unsigned email statement from the California attorney general’s office said the state’s Department of Justice is committed to protecting charitable assets for their intended purpose.

OpenAI’s leaders have struggled with its structure since its founding, emails released in the course of Musk’s lawsuit last year show. Musk, initially the company’s primary financial backer, and his co-founders squabbled over control of the project and how to make it sustainable. The billionaire left OpenAI in 2018 after Altman and other leaders rejected his suggestion that he take over the company.

Soon after, OpenAI took on outside investment to fund the high costs of AI development, which requires access to powerful computer chips. Microsoft and other investors piled more money into OpenAI after the 2022 launch of ChatGPT sparked an intense AI race across the tech industry.

AI development is now more expensive than ever. Microsoft plans to spend $80 billion this year on new AI data centers, and Google has said most of its $75 billion in capital expenditures this year will also be spent on AI infrastructure.

OpenAI has said it needs more investment to keep up with spending by AI rivals and last month raised $40 billion from investors including Japanese conglomerate SoftBank. Most of that money will only be provided if the company sheds its nonprofit status by the end of the year.

Jacob Hilton, a former OpenAI worker who left the company in 2023 and signed the recent letter to state attorneys general, said meeting that condition would see OpenAI abandon its roots.

“The proposed restructuring would contradict what I was told by company leadership throughout my four and a half years at the company: that OpenAI’s primary fiduciary duty is to humanity,” Hilton said. “They are proposing to abandon that foundational pledge.