Elon Musk v OpenAI, Court Filing, retrieved on April 30, 2024, is part of HackerNoon’s Legal PDF Series. You can jump to any part of this filing here. This part is 22 of 29.

COUNT X: FALSE ADVERTISING UNDER THE LANHAM ACT, 15 U.S.C. § 1125(a)(1)(B) (Against Altman, Brockman, and OpenAI, Inc.)

280. Plaintiff re-alleges and incorporates by reference paragraphs 1 through 279 inclusive, as though fully set forth herein.

281. Altman and Brockman induced an unwitting Musk to co-found their spurious non-profit, OpenAI, Inc. They then exploited Musk’s stature and reputation to elicit public trust and support for the non-profit, recruit top AI scientists and engineers, and solicit financial contributions from third parties through knowingly false marketing and promotion of the non-profit, harming Musk’s business interests and reputation.

282. Musk is well-known for his commitment to open technology—e.g., Tesla and SpaceX generally do not hold and/or do not enforce patents for their technology, which is free for the public to use.

283. Altman and Brockman, in their individual capacities and on behalf of OpenAI, Inc., harnessed Musk’s business reputation by among other things, making Musk co-chair of the Board, using his track record to recruit top talent, and promoting his name and involvement on OpenAI, Inc.’s website and other marketing of OpenAI, Inc.

284. Defendants in their marketing, advertisements, and promotions made knowingly false and/or misleading representations to the public that OpenAI, Inc. would be a non-profit whose mission is to develop safe and opensource AI/AGI technology for the public good, not private gain.

285. Commencing on December 11, 2015 and continuing to today, OpenAI, Inc.’s website represented that “OpenAI’s co-chairs are Sam Altman and Elon Musk” and that:

• “OpenAI is a non-profit artificial intelligence research company [whose] goal is to advance digital intelligence in the way that is most likely to benefit humanity as a whole, unconstrained by a need to generate financial return. Since our research is free from financial obligations, we can better focus on a positive human impact.”

• “We believe AI should be an extension of individual human will and, in the spirit of liberty, as broadly and evenly distributed as possible.”

• “Because of AI’s surprising history, it’s hard to predict when human-level AI might come within reach. When it does, it’ll be important to have a leading research institution which can prioritize a good outcome for all over its own self-interest.”

• “As a non-profit, our aim is to build value for everyone rather than shareholders.”

• “Our primary fiduciary duty is to humanity. We anticipate needing to marshal substantial resources to fulfill our mission, but will always diligently act to minimize conflicts of interest among our employees and stakeholders that could compromise broad benefit.”

• “Researchers will be strongly encouraged to publish their work, whether as papers, blog posts, or code, and our patents (if any) will be shared with the world.”

• “Our mission is to ensure that [AGI] benefits all humanity, primarily by attempting to build safe AGI and share the benefits with the world.” 286. OpenAI, Inc.’s Charter, posted on its website, claims: “We commit to use any influence we obtain over AGI’s deployment to ensure it is used for the benefit of all, and to avoid enabling uses of AI or AGI that harm humanity or unduly concentrate power. Our primary fiduciary duty is to humanity.”

287. Even in marketing OpenAI, L.P., on March 11, 2019, Defendants claimed: “The General Partner’s duty to this mission and the principles advanced in the OpenAI Inc. Charter take precedence over any obligation to generate a profit.” OpenAI, Inc.’s website stated: “We’ve designed OpenAI LP [sic] to put our overall mission—ensuring the creation and adoption of safe and beneficial AGI—ahead of generating returns for investors. . . . Regardless of how the world evolves, we are committed—legally and personally—to our mission.”

288. Altman and Brockman made these material, false, and misleading representations of fact about the nature, characteristics, and qualities of Defendants’ products and services in commercial advertising or promotion in interstate commerce, namely, OpenAI, Inc.’s website, online marketing, online blog posts, and Defendants’ social media.

289. These false and misleading statements have deceived and/or are likely to deceive a substantial segment of the public.

290. Defendants’ false and misleading claims are material because they are likely to induce the relevant public to make financial and/or other contributions, including the rendering of services (like the top scientists they recruited) to OpenAI, Inc. in the belief they are supporting an open-source, not-for-profit AI/AGI research foundation, when in fact, they are providing capital, support, and/or services to what is covertly a thoroughly commercial enterprise.

291. Defendants’ conduct constitutes false advertising and unfair competition in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B).

292. Defendants’ deceptive conduct and false and misleading claims have injured and will continue to injure Musk’s valuable business reputation and commercial interests. Defendants intentionally concealed their wrongful conduct, which prevented Musk from discovering their scheme, notwithstanding his exercise of due diligence.

293. As a prominent and well-respected tech figure, Musk’s name and reputation served to attract top-tier AI scientists and engineers to OpenAI, Inc. Indeed, it was Musk’s reputation and track record which served to recruit OpenAI, Inc.’s prominent Chief Scientist, Dr. Sutskever away from Google. But as alleged hereinabove, numerous key executives at OpenAI, Inc., including Dr. Sutskever, are now resigning from the supposed non-profit due to Defendants’ conflicted pursuit of profits over safety.

294. Defendants’ misrepresentations, by affiliation, have harmed, and will continue to harm Musk’s professional standing and commercial interests particularly in the AI/tech industry, eroding his ability to recruit leading AI scientists and engineers, as he had done for Defendants. Such harm is particularly acute in the field of AI, where the recruitment of a very limited pool of top scientists and engineers is fiercely competitive and pivotal to success.

295. As a direct and proximate result of Altman, Brockman, and OpenAI, Inc.’s conduct, acts, and omissions alleged hereinabove, Musk is entitled to recover the damages he sustained and will sustain, including any income, gains, compensation, profits, and advantages obtained, received, or to be received by Defendants, or any of them, arising from their wrongful conduct, including prejudgment interest. Musk is entitled to an order requiring Defendants, jointly and severally, to render an accounting to ascertain the amount of such proceeds.

296. As a direct and proximate result of Defendants’ wrongful conduct, acts, and omissions alleged hereinabove, Musk has been damaged, and Defendants have been and will continue to be unjustly enriched, in an amount that shall be assessed at trial, and for which restitution and/or non-restitutionary disgorgement is appropriate. Such should include the imposition of a constructive trust; a declaration by this Court that Defendants are jointly and severally the constructive trustee(s) for the benefit of Musk; and an order that Defendants convey to Musk all of the profits, assets, property, and ill-gotten gains received or to be received by Defendants, which are traceable to Musk’s wrongfully acquired financial and other contributions to OpenAI, Inc.

297. Unless enjoined by this Court pursuant to 15 U.S.C. § 1116, Defendants will continue to mislead the public and cause harm to Musk. Musk is entitled to an injunction during the pendency of this action, and permanently enjoining Defendants, their officers, agents, and employees, and all persons acting in concert with them, from engaging in such further acts.

298. Defendants’ false and misleading claims are deliberate, willful, fraudulent, and without extenuating circumstances. Defendants’ conduct is thus an “exceptional case” within the meaning of section 35(a) of the Lanham Act, 15 U.S.C. § 1117(a). Musk is therefore entitled to recover three times the amount of his actual damages and his attorneys’ fees and costs incurred in this action.

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