Sam Altman Won in Court Against Elon Musk. But, We All Lost

The article summarizes the recent trial between Elon Musk and Sam Altman, where Musk sued Altman and OpenAI for allegedly betraying the nonprofit's original mission by transforming it into a for-profit entity worth nearly a trillion dollars. The author argues that while Altman won the legal battle, the case revealed both men as untrustworthy and self-serving, likening the courtroom to an "island of lying cretins" where no one could be believed. Ultimately, the piece concludes that the public lost, as the trial exposed the corruption and hypocrisy at the heart of AI governance.

A famous logic puzzle takes place on a mythical island divided between the knights, who never lie, and the knaves, who always do. A foreign traveller encounters a fork in the road: one way guarantees safe passage, the other certain death. A member of each tribe is present, though it isn’t clear which is which, and the traveller is granted only one question. The solution is well known: ask either of them what the other would advise, and then to choose the opposite path. An accurate account of a lie and an inaccurate account of the truth amount to the same wrong answer. But this works only if someone is honest. What if nobody can be trusted? The Cretan philosopher Epimenides inspired an alternative scenario set on his own island, when he supposedly said that “all Cretans are liars.” Logicians call unstable statements like these “self-referential paradoxes,” or utterances that undermine their own claims. Epimenides would presumably have felt at home at trial of Musk v. Altman, which over the past few weeks turned an Oakland courtroom into an island of lying cretins. In theory, the trial was about the good-faith control of artificial intelligence. In 2015, Elon Musk and Sam Altman founded OpenAI together as a nonprofit. Its mission—“to ensure that artificial general intelligence benefits all of humanity”—was explicitly intended to counter Google’s potential dominance of the technology, which seemed almost foreordained at the time. Musk pledged up to a billion dollars to prevent that outcome. It didn’t take long for the two men to disagree over the chain of command. Each thought he alone deserved to run the show. About two years and thirty-eight million dollars later, Musk took his remaining nine hundred and sixty-odd million dollars and went home. In his valedictory e-mail, he wrote, “My probability assessment of OpenAI being relevant to DeepMind/Google without a dramatic change in execution and resources is 0%. Not 1%. I wish it were otherwise.” OpenAI needed another source of largesse. With investors in mind, it opened a for-profit subsidiary and secured billions of dollars from Microsoft and others. This past October, the company completed a lengthy process of restructuring and recapitalization. Today, the subsidiary is worth something close to a trillion dollars. Musk’s lawsuit alleged that Altman, along with other OpenAI executives and in collusion with Microsoft, “stole a charity.” He believes that they solicited his generosity on false pretenses, exploiting the cover of a humanitarian cause to build one of the world’s most valuable companies, and, in the process, enriching themselves beyond measure. The remedies he sought include the unwinding of OpenAI’s transformation into a for-profit company, the disgorgement of a hundred and fifty billion dollars in damages to be paid to the original nonprofit, and the final exile of Altman from the organization. It would effectively destroy the venture as such. The suit was an act of vengeance, and its primary function seemed to be to make everyone involved look heinous. At the very least, it promised to be entertaining. During jury selection, one prospective juror assessed Musk to be “a greedy, racist, homophobic piece of garbage,” while a more restrained prospect deemed him only “a world-class jerk.” Musk’s lawyers argued that such sentiments were blatantly prejudicial. Yvonne Gonzalez Rogers, the district-court judge and one of the few trial participants who managed to acquit herself honorably, told them to suck it up. “The reality is that people don’t like him,” she said. “Many people don’t like him—but that doesn’t mean that Americans nevertheless can’t have integrity for the judicial process.” In the first week of testimony, Musk took the stand and couldn’t help but get tetchy. He seemed to have the impression that he alone understood the finer points of trial law. The Verge reporter Elizabeth Lopatto, who seemed to be live-blogging her own disgorgement not of money but of bile , wrote, “I have never been more sympathetic to Sam Altman in my life.” Musk’s attorneys hoped that the second week—which rehashed an imbroglio from around Thanksgiving 2023, when the OpenAI board fired Altman only for Altman to return and fire almost the entire board—would mitigate Altman’s contrasting appeal. These allegations, for anyone unfortunate enough to have paid close attention, had long been rehearsed to death, and the iterative incantation of now-canonical lines from e-mails and text had the quality of operatic leitmotif: Altman had been removed, we heard again and again, for having been “not consistently candid in his communications.” The few novel revelations made him look less like a mastermind than kind of a loser. The existence of the lawsuit was almost redeemed by the release of a text thread between Altman, who was conferring with the Microsoft C.E.O., Satya Nadella, and Mira Murati, who briefly replaced Altman as chief executive. Altman plays the role of the clueless boyfriend who can’t accept that his partner is leaving him: “Directionally” is Silicon Valley jargon for “generally.” But Altman still doesn’t get it: Most of the regular courtroom observers eventually gave themselves over to listlessness. Wired ran a story about the butt pillows used by OpenAI’s phalanx of lawyers and executives, including the president and co-defendant, Greg Brockman, to insulate themselves from the discomfort of the court’s benches. On a Tuesday morning of the third and final week of trial arguments, in the vacant hours of predawn Oakland, I arrived at the Ronald V. Dellums Federal Building to find a half-dozen journalists and interested civilians in the disorderly semblance of a self-organized queue. One woman, who had severe bangs and a medieval-looking corona of braids, reminded Lopatto, the quick-witted Verge reporter, of a “stern German nanny”; she declined to provide her name or purpose and refused to recognize the authority of the line. The general topic of desultory conversation was not the dispiriting trial of the present but the livelier intrigue of courtroom tech-dramas past—of Elizabeth Holmes, which inspired particular nostalgia, or Sam Bankman-Fried. Neither of those performances featured anybody to pull for, exactly, but at least they held out the pleasurable promise of comeuppance. Had Musk v. Altman merely been a petulant matter of injured vanity, it might have played as a diverting farce. It was instead a travesty. The underlying issues—of how A.I. ought to be governed, and by whom, and how—are of great consequence. But in this trial, to root against Tweedledum was effectively to root for Tweedledee. It was a no-win situation. The butt pillow might have begun as a symbol of the trial’s frivolity, but it was clear soon enough that it was also a powerful metaphor for the collective failures that got us here. It was difficult, sitting in the unyielding pews, not to feel personally implicated. These were the leaders our society had somehow been assigned. Mike Isaac, a veteran tech reporter for the Times, wasn’t ashamed to admit that Brockman had inspired him to secure his own butt pillow. Isaac, a magnanimous man who looks like the actor Wilford Brimley styled as a member of the hardcore band Minor Threat, offered to share the cushion, but it struck me as somehow more appropriate to sit in the docks as a penitent. The courtroom filled up quickly in anticipation of Sam Altman, who was set to appear on the stand that day under oath. The OpenAI C.E.O. has long been known for his boyishness, but the past few years have coarsened his features and frosted his spiky hair with gray tips. He looked like a lesser vocalist for ’N Sync on a reunion tour. His presence in the courtroom had the mournful air of someone who no longer qualified as precocious. The basic question of the case, which is also the basic question of Altman’s career, is whether the transmogrification of OpenAI from a safety-minded nonprofit into a ravenous corporate behemoth was cynical in intention or merely in outcome. Recently, my New Yorker colleague Andrew Marantz appeared on a podcast to discuss the alternative ways to model his behavior: the “always-a-master-plan, 3-D-chess view” and the “improvisatory-checkers-all-along view.” There was a clever bit of trollery in Altman’s decision to hire as lead counsel the lawyer William Savitt, who had earlier forced Musk to follow through on his impulse to buy Twitter. Over hours of direct questioning, Savitt elicited from his brow-furrowed client a defense narrative that combined the most flattering elements of each version of the story. The part of the scheme that involved the creation of what he praised as “one of the largest charities in the world”—the nonprofit parent, by virtue of its equity stake in the for-profit subsidiary, has assets valued at more than two hundred billion dollars—was the result of what Altman repeatedly called “hard work” or “incredible work.” But the part of the scheme that involved the creation of one of the largest and most powerful for-profit companies in the world was extemporaneous—the by-product of having been “open to creative structures.” Altman said, “So this sounds a little silly to say now, but at the time, we almost didn’t start this effort because we thought Google was so far ahead that it might be hopeless to compete.” The decision to stand up a profit-making entity was a matter of facts on the ground: the future of humanity required that OpenAI prevail in an existential battle against Google; this battle could not be fought without access to enormous pools of capital; it was impossible to court investors without the promise of returns. On these three points, everyone involved was in agreement: a dinky donor-funded charity would be taking an abacus to a data-center fight. It was acknowledged only in passing that the introduction of a fiduciary motive might create perverse incentives, and even then the worry was primarily about optics. As one of Musk’s consiglieri wrote in an e-mail, “I’m a super fan of capitalism and making tons of money doing great things, but not sure if this correlates with the ‘noble cause for humanity, not doing it to make money’ narrative.” What divided Musk and his lieutenants, on one side, from Altman, Brockman, and the OpenAI chief scientist Ilya Sutskever, on the other, was the unresolved issue of which special man got to wear the pants. In September, 2017, Musk e-mailed Sutskever and Brockman to describe a scenario in which he “would unequivocally have initial control of the company.” He insisted that he had no interest in retaining unilateral power over the destiny of the species. At some unspecified time, he continued, the authority vested in him, by him, would devolve upon an expanded board: “The rough target would be to get to a 12 person board probably more like 16 if this board really ends up deciding the fate of the world .” This organizational structure might have struck a reasonable person as a trifle undemocratic, all things considered, but what was readily clear from the trial was that Musk and Altman agreed that A.I. governance was much too serious to be left in the hands of non-player characters such as the nine assembled jurors. Altman, at times, spoke to them like children: Microsoft built them a “big computer,” but they needed “more capital to keep building larger computers.” The ongoing effect was like the scene in “Airplane ” where Julie Hagerty’s stewardess character, upon hearing that a passenger needs to go to the hospital, asks, “A hospital? What is it?” and Leslie Nielsen’s character treats her like a ditz: “It’s a big building with patients, but that’s not important right now.” In his defense, it seemed as though the main lesson he’d gleaned from his dealings with Musk is that many grownups are best treated as toddlers. Altman testified that Shivon Zilis, a Musk confidant, onetime OpenAI board member, and the mother of some of