Elon sues for $134b in damages in lawsuit against OpenAI and Microsoft

Elon Musk has launched a sweeping legal challenge against OpenAI and its major backer Microsoft, demanding a combined $134 billion in damages and alleging the companies improperly profited from his early involvement in the artificial intelligence venture.

In court documents filed on Friday, Musk claimed that OpenAI generated “wrongful gains” after he provided early financial backing and strategic support during its formative years.

The filing claims Musk was effectively deprived of the value of roughly $38 million in seed funding he contributed in 2015, and that he is therefore entitled to a portion of OpenAI’s current valuation, estimated at around $500 billion.

According to the submission, OpenAI itself is said to have derived between $65.5 billion and $109.4 billion in value from that early funding, while Microsoft — which began investing in the company in 2019 and holds a reported 27% stake in OpenAI Group PBC — allegedly gained between $13.3 billion and $25.1 billion.

Musk’s lead lawyer, Steven Molo, said the billionaire’s role went far beyond writing cheques, arguing that OpenAI would not exist without Musk’s funding, credibility, and guidance on scaling technology companies. The damages calculations cited in the filing are based on analysis by financial economist C. Paul Wazzan.

OpenAI has rejected the claims, describing them as unfounded and accusing Musk of pursuing a campaign of harassment. Microsoft declined to comment on the compensation demand. In a separate submission, the two companies asked the court to exclude Wazzan’s analysis, labelling it speculative and unverifiable.

Musk co-founded OpenAI in 2015 and invested an estimated $45 million before stepping down from its board in 2018 following disagreements with chief executive Sam Altman. Since then, he has repeatedly criticised OpenAI’s shift toward commercialisation and its close ties with Microsoft. In February 2025, Musk made an unsuccessful $97.4 billion bid to acquire OpenAI in an effort to block its transition to a for-profit structure, an offer Altman publicly rebuffed.

OpenAI surpassed Musk’s SpaceX as the world’s most valuable private technology company in October, when it reached a $500 billion valuation after employees and former staff sold about $6.6 billion worth of shares to a group of investors.