Musk v. OpenAI: Why a $38 Million Donation Is at the Center of the Trial

That founding story is now doing heavy legal work. If OpenAI’s early nonprofit language was only a broad statement of ideals, it may carry limited legal force. If Musk can show those statements were concrete promises that helped secure his money and support, the case becomes much more serious: the court must consider whether later commercial arrangements conflicted with those commitments.

What happened on day two

CNBC reported that the proceedings were overseen by U.S. District Judge Yvonne Gonzalez Rogers in federal court in Oakland, California, with Altman and OpenAI president Greg Brockman also in attendance.

On Wednesday, Musk was on the stand for a second day. The BBC reported that he was combative under questioning from OpenAI lawyer William Savitt, at one point saying, “Your questions are not simple,” and that they were “designed to trick me essentially.”

The Guardian reported that Musk repeated his allegation that Altman “stole a charity” and said he had been a “fool” for funding OpenAI. Those lines made for courtroom drama, but the deeper issue is institutional: how much weight should a nonprofit origin story carry once an AI company becomes commercially valuable?

Why the $38 million donation is so important

The donation turns the dispute from a personal feud into a question about donor trust. Musk says he gave $38 million because he believed OpenAI would stay nonprofit and build AI for the public benefit, not private gain.

That matters because courts often have to distinguish between aspirational language and reliance. Musk’s argument is that the nonprofit promise was not merely branding — it was part of the basis on which he donated. OpenAI’s position, as reported by CNBC, is that the lawsuit is baseless.

The requested remedy also reflects that shift. CNBC reported that Musk previously sought up to $134 billion in personal damages, but is now asking for “all ill-gotten gains” to go to OpenAI’s charity.

“They can’t have it both ways”

NBC reported that Musk summed up his argument in court by saying OpenAI could not “have it both ways.” He said the company could not enjoy “a nonprofit and free funding and the positive halo effect of being a nonprofit charity” while also allowing insiders or private stakeholders to benefit greatly.

That sentence captures the heart of Musk’s case. He is arguing that nonprofit status should not operate as a one-way reputational advantage: useful for attracting money, talent and public trust at the start, but optional once the commercial upside grows.

Why OpenAI’s restructuring raised the stakes

NBC reported that OpenAI completed a corporate restructuring in October, shifting from a capped-profit model to a more traditional for-profit structure.

That move gives the case a current, practical edge. The trial is not only about what Musk and Altman said in 2015. It is also about whether OpenAI’s present-day structure can be squared with the early promises that helped define the organization’s identity.

At this stage, the publicly reported record remains one of allegation and denial, not a final legal finding. Musk is trying to connect OpenAI’s current corporate direction to its founding commitments; OpenAI continues to reject the lawsuit as baseless.

Why this is bigger than two tech billionaires

ABC/AP reported that the dueling testimony from Musk and Altman is expected to shed light on the thinking that helped trigger the AI race, as well as the breakdown of their relationship.

But the public significance is larger than the personal rivalry. AI companies often speak in terms of safety, public benefit and humanity-scale impact. This case asks what happens when those mission statements help attract support — and the organization later sits on enormous commercial value.

Three things to watch next

• How specific the nonprofit promise was. Musk’s side needs to connect OpenAI’s early language to a concrete obligation; OpenAI says the lawsuit is baseless.
• Whether the $38 million donation was made in reliance on that promise. Musk says the donation followed assurances that OpenAI would remain nonprofit and serve the public benefit.
• How the restructuring is interpreted. OpenAI’s shift from a capped-profit model to a more traditional for-profit structure could be framed either as normal corporate evolution or as evidence of conflict with earlier commitments.

Whatever the outcome, the trial has made one question unavoidable: when an AI organization is built on the language of public benefit, do those words still count when the business opportunity becomes enormous?