Altman Rejects Musk’s Claim That OpenAI’s Nonprofit Was Shortchanged

OpenAI CEO Sam Altman told a federal judge Tuesday that accusations by Elon Musk — suggesting the nonprofit side of the company was sidelined when software products began to be sold — are wrongheaded. Speaking on the witness stand, Altman argued that the organization’s charitable arm has grown into a major philanthropic institution with assets now approaching two hundred billion dollars, and he said its work remains central to the group’s mission.

The dispute centers on whether OpenAI abandoned safety goals as it built commercial offerings. Musk’s lawyers have highlighted that the nonprofit did not employ full-time staff until early this year. But Bret Taylor, who chairs OpenAI’s board, testified those staffing limits were tied to the difficulty of converting equity into cash — a problem the company addressed during a corporate overhaul completed in 2025. Legal experts watching the trial say the judge will likely weigh not only the figures but whether the foundation’s resources and decision-making genuinely served the public interest.

Altman recounted a fraught debate among the founders in 2017 about how to fund increasingly expensive AI research. He portrayed one exchange as especially troubling: when asked what would happen to control of a prospective commercial arm if its backer died, Musk suggested ownership could remain within his family. Altman said that answer reinforced his reluctance to let a single individual dominate a project intended to be widely accessible. He added that his time at a major startup accelerator had taught him founders who retain tight control often don’t relinquish it easily.

He also criticized Musk’s management style as ill-suited to a research-focused organization, saying certain actions hampered morale and drove away talent. Altman described episodes in which researchers were ranked and publicly pared back — steps he said caused lasting harm to the workplace culture and to recruitment of top scientists. In court he positioned himself as protecting the contributions and stakes of co-founders who stayed on the project full time, including Greg Brockman and Ilya Sutskever.

Musk resigned from OpenAI’s board years ago and has since pursued his own AI projects at Tesla and xAI. But Altman testified that the two men continued to communicate, and that Musk was informed about major investment talks. Altman recalled the 2018 Microsoft discussions as unusually friendly, noting Musk’s lighter demeanor during that session.

Outside lawyers and industry analysts offered commentary after the hearing. A law professor specializing in nonprofit governance said the case will turn on whether the trustees acted within the bounds of charitable duty when they permitted commercial activities, and whether donors and the public were misled. Consumers and developers, the professor warned, could see the effects in access to tools, pricing and regulatory scrutiny depending on the court’s ruling.