The Volokh Conspiracy
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Elon Musk's Case Against OpenAI Can Go Forward, as to Some Claims
From the decision just issued by Judge Yvonne Gonzalez Rogers in Musk v. OpenAI (N.D. Cal.):
[As to the express contract claim:] [T]he parties agree that there is no one single document that consists of a contract. At best, Musk argues that emails exchanged with various defendants between 2015 and 2019 constitute an express contract. The Court disagrees. Therefore, the motion to dismiss Count I is Granted.
[As to the implied-in-fact contract claim:] Although there is no express contract, Musk adequately pleads in the alternative that there is an implied-in-fact contract manifested by the alleged conduct of the OpenAI. The FAC also adequately alleges Musk's performance, defendants' breach, and the resulting harm to Musk. The motion to dismiss Count II is Denied….
The court allows some other related claims (for instance for unjust enrichment and fraud) to go forward as well, and rejects still others. This is just a decision on a motion to dismiss, so the court is only asking whether plaintiffs had plausibly alleged something legally actionable. A decision on whether there was indeed a breach of an implied contract, fraud, unjust enrichment, and so on is still in the future.
For more on the case, see this March N.Y. Times article (Cade Metz):
In November, Elon Musk asked a federal court to block OpenAI's plan to transform itself from a nonprofit into a purely for-profit company.
On Tuesday, a federal judge in San Francisco denied Mr. Musk's request, calling it "extraordinary." But the court allowed Mr. Musk to proceed with other aspects of a lawsuit he filed last year against OpenAI and its chief executive, Sam Altman….
Note that I was local counsel on an amicus brief filed by some former OpenAI employees, but am not otherwise involved in the case.
