Judge allows Elon Musk to bring fraud claims against OpenAI

By 
 May 4, 2025

A judge has decided to allow Elon Musk to bring fraud claims against the AI startup OpenAI. 

This news was first reported by Bloomberg.

This, as we will see, is one of two big victories that Musk recently obtained, as he appears to be moving on from his time in the Trump administration.

We'll start with this legal victory.

Here's what is going on:

Musk has been in a legal battle with OpenAI. He has alleged, according to Breitbart News, that "the company broke its promise to operate as a public charity when CEO Sam Altman decided to become a for-profit enterprise."

On Thursday, US District Judge Yvonne Gonzalez Rogers ruled that Musk can bring fraud claims against the company.

Breitbart reports:

While Judge Gonzalez Rogers narrowed the claims in the complaint filed by Musk last year, she upheld the fraud allegations against OpenAI. Additionally, the judge declined to dismiss an unjust enrichment claim against both OpenAI and Microsoft, a major investor in the startup. However, she threw out false advertising and breach of fiduciary duty claims against OpenAI.

This is a major victory for Musk, although there is still much to be done in the case, such as actually proving those fraud claims.

Among other things, Musk and his legal team will argue, "Microsoft was aware of OpenAI co-founders Sam Altman and Greg Brockman engaging in 'a scheme to defraud Musk of his valuable contributions and backing to enrich themselves.'"

More winning

Musk just obtained another big win when residents in Texas vote to allow him to incorporate Starbase as a city. In other words, Texas just gave Musk the go-ahead to create his own city.

The Daily Mail reports:

Elon Musk has won a vote to create his own Texas city as part of his ambitious pledge to colonize Mars. The SpaceX boss will turn his company's headquarters at Boca Chica - at the southern tip of the Lone Star State - into a city named Starbase. Residents voted 173 to 4 to incorporate Starbase as a city

Musk expressed his happiness, after getting the okay, in social media post, writing, in one, "Starbase, Texas Is now a real city!"

"Becoming a city will help us continue building the best community possible for the men and women building the future of humanity's place in space," he added in another.

These are a couple of big wins for Musk, after he has faced much criticism for his work with the Trump administration.

" A free people [claim] their rights, as derived from the laws of nature."
Thomas Jefferson