Summary
On April 28, 2026, a federal civil trial opened before Judge Yvonne Gonzalez Rogers in Oakland, California, testing whether OpenAI's 2025 conversion from a nonprofit to a Delaware Public Benefit Corporation breached a charitable trust created by Elon Musk's approximately $38 million in contributions to the company. Of 26 claims Musk filed in 2024, only two survived to trial: breach of charitable trust and unjust enrichment. Musk is seeking approximately $134 billion in damages from OpenAI and co-defendant Microsoft, and a court order unwinding the for-profit conversion and removing Sam Altman and Greg Brockman from leadership. The liability phase is expected to conclude by May 21, 2026.
What Happened
Elon Musk co-founded OpenAI in 2015 alongside Sam Altman, Greg Brockman, Ilya Sutskever, and others, contributing approximately $38 million to the organization — substantially less than the $1 billion he had initially pledged. He departed from the OpenAI board in 2018. In 2024, Musk filed suit in federal court alleging that Altman and Brockman had betrayed the company's founding mission by engineering its conversion to a for-profit entity. The complaint originally contained 26 claims; by April 2026, Judge Yvonne Gonzalez Rogers had narrowed the case to two: breach of charitable trust and unjust enrichment.
The trial began with jury selection on April 27, 2026. Nine jurors were seated. Jury questionnaires revealed strong pre-existing opinions about Musk among the jury pool, an unusually public preview of the reputational terrain both parties would navigate throughout the proceeding. Opening arguments commenced on April 28. Musk's lead attorney, Steven Molo, told the jury that Altman, Brockman, and Microsoft had "enriched themselves, made themselves more powerful, and breached the very basic principles on which the charity was founded." OpenAI's lead attorney, Bill Savitt, argued that the lawsuit was motivated by commercial competition: "We are here because Mr. Musk turned out to be very wrong about OpenAI. We're here now because Mr. Musk now competes with OpenAI." Microsoft's attorney, Russell Cohen, told the jury that Microsoft had not — and legally could not have — aided any breach of charitable trust, given that charitable trust obligations bound OpenAI's principals, not its investors.
Musk took the witness stand on April 28 and testified across three days. His testimony included several notable admissions: that he contributed approximately $38 million rather than the $1 billion he had announced, citing lost confidence in the team; that he had demanded and been denied control of the company and its potential merger with Tesla; and that xAI, his competing AI venture, had "partly" used OpenAI models during training. Judge Gonzalez Rogers issued an order during the proceedings instructing both Musk and Altman to cease making social media posts that could be construed as attempts to influence the jury. In a court filing, Musk stated that any damages he receives would be directed to the OpenAI Foundation (the nonprofit entity), not retained personally.
Sam Altman and Greg Brockman were expected to testify later in May; the liability phase was scheduled to conclude by approximately May 21, 2026.
The legal theory at the core of the charitable trust claim is that Musk's $38 million in contributions constituted a restricted charitable gift — creating a trust under California law requiring OpenAI to remain organized and operated as a nonprofit in perpetuity. If the court accepts this argument, the 2025 PBC restructuring, which converted OpenAI to a for-profit Delaware corporation while leaving a 26% equity stake with the OpenAI Foundation nonprofit, would constitute a breach of that trust obligation, entitling Musk to equitable remedies including unwinding. OpenAI's defense contests both that a charitable trust was formed and that, even if it was, the current structure satisfies its terms — given the Foundation's retained governance control and equity stake.
Why It Matters
The Musk v. Altman trial is the first substantive judicial proceeding to test whether a major AI company's for-profit conversion constitutes a breach of charitable trust under American law. The question is not narrow: if a court finds that early contributions to a nonprofit AI lab created binding restrictions on its subsequent corporate structure, the legal theory would be potentially applicable to any AI company that accepted charitable donations under a nonprofit mission and subsequently converted to for-profit operation. No precedent directly on point existed as of trial opening.
The specific remedies Musk is seeking — unwinding the PBC conversion and removing Altman and Brockman — would, if granted, be among the most significant judicially-ordered corporate restructurings in US history, affecting a company valued at approximately $852 billion. The practical enforceability of such an order, given OpenAI's existing commercial commitments with Microsoft, Amazon, and hundreds of enterprise customers, is itself an open legal question. Musk's stated intention to direct any damages to the nonprofit foundation rather than retain them personally shaped how the case was publicly characterized — as a governance dispute rather than a personal enrichment claim — though OpenAI contested this framing, positioning the litigation as commercially motivated.
What is unknown at trial opening: the strength of the documentary evidence underlying the charitable trust formation theory; whether Musk's acknowledged demands for personal control and consideration of absorbing OpenAI into Tesla will undercut his claim that his contributions were unconditionally charitable; how Judge Gonzalez Rogers will interpret the scope of California charitable trust law as applied to a Delaware-incorporated AI laboratory; and whether the liability phase will produce findings that are appealed regardless of outcome. The credibility findings the jury makes during Musk's and Altman's testimony will not be fully disclosed until a verdict is reached.
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