Meta and Musk vs. OpenAI: Legal clash over transformation into for-profit company | Meta Facebook login | Facebook | Meta AI WhatsApp | Turtles AI

Meta joins Elon Musk in challenging OpenAI’s transformation into a for-profit entity, calling for action by California authorities to block the change.

Key Points:

• Meta and Musk Unite: Meta Backs Elon Musk’s Legal Initiatives Against OpenAI.
• Silicon Valley Risks: Meta Highlights Potential Destabilizing Effects on Tech Industry.
• Tax Benefits Under Fire: Criticism Over Tax Benefits for Nonprofit Investors in Transformed Companies.
• OpenAI Responds: Company Denies Allegations, Calls for Market Competition.

Facebook’s parent company Meta has come out against OpenAI’s transformation from a nonprofit to a for-profit entity, sending a formal request to California Attorney General Rob Bonta to intervene to stop the process. The company has expressed deep concerns about the repercussions this change could have on the Silicon Valley tech landscape. In a detailed letter, Meta stressed that this transformation would represent a significant departure from traditional nonprofit governance norms, highlighting how investors in this new business model would end up enjoying tax advantages afforded to nonprofits, while still earning similar profits to those guaranteed by traditional for-profit businesses. A condition that, according to Meta, could set a dangerous precedent.

The letter also supports the legal action brought by Elon Musk, former co-founder of OpenAI and now founder of xAI, a rival organization. Musk has sued OpenAI, seeking an injunction to block its conversion into a for-profit company, arguing that this move is inconsistent with the principles on which the organization was originally founded. Along with Musk, Shivon Zilis, a former member of OpenAI’s board of directors, is also among the plaintiffs, with both of them described by Meta as “qualified individuals” to represent the interests of California citizens in this matter.

Meta further emphasized that the case has far-reaching implications, both for the competitive balance among technology companies and for the tax and regulatory policies that govern the sector. While Meta itself is actively involved in the AI ​​race, directly competing with OpenAI, its position aims to raise a broader question about the ethical and legal principles that should guide the evolution of the technology market.

For its part, OpenAI responded by publishing a series of internal communications, including emails and text messages from Elon Musk, arguing that its legal action represents an attempt to interfere with competition. The company said Musk’s response should focus on developing better solutions rather than using the courts to thwart OpenAI’s work. The confrontation highlights the growing debate about the balance between innovation, transparency, and competitiveness in the global tech ecosystem.

Regardless of the legal conclusions, the case raises significant questions about the responsibilities of tech companies in shaping the future of AI and the role of institutions in ensuring fair competition.