OpenAI Faces Musk's Surviving Fraud Claims in Lawsuit

A federal judge has rejected OpenAI's attempt to dismiss Elon Musk's fraud allegations, allowing key claims in his lawsuit to proceed. Musk, a cofounder and early investor, argues that OpenAI broke its promise to remain a nonprofit and instead sought to restructure as a for-profit company, violating its original mission and the terms of his donations. While many of Musk's claims, such as racketeering and breach of fiduciary duty, were dismissed, the court found that the fraud and implied contract claims were sufficiently plausible to continue. The judge cited allegations that OpenAI induced Musk's contributions with promises of maintaining nonprofit status, but intended to use the funds to enrich themselves through for-profit ventures. Some related claims, including unjust enrichment, were also allowed to move forward, while the court emphasized that the ruling concerns the adequacy of the allegations rather than their ultimate merit. The case now advances toward trial with these narrowed but significant claims.