Elon Musk seeks $134 Billion From OpenAI as Grok Controversy

Elon Musk is attempting to turn a philosophical fight over OpenAI’s mission into a hard-dollar scoreboard, and the numbers are so large they force a bigger question about who captures the upside when a nonprofit-era AI lab becomes a for-profit juggernaut.

Over the past day, that question has been pulled into two separate legal storms: one aimed outward at OpenAI and Microsoft, and one aimed back at Musk’s own AI company.

In federal court in Oakland, Musk has asked for roughly $79 billion to $134 billion from OpenAI and Microsoft, arguing they earned “wrongful gains” tied to OpenAI’s shift away from the nonprofit mission he says he helped build.

Reporting on the filing says his damages theory is built around claimed gains of $65.5 billion to $109.4 billion attributed to OpenAI and $13.3 billion to $25.1 billion attributed to Microsoft.

Those figures look almost surreal until you see the context number being attached to them in coverage, a roughly $500 billion valuation used to explain why the claim scales into the tens of billions.

OpenAI and Microsoft have pushed back hard on the damages approach, arguing the methodology is speculative, and OpenAI has described the effort as harassment in public-facing responses.

OpenAI also chose not to keep this argument confined to court filings. In a post titled “The truth Elon left out,” OpenAI argues Musk supported the idea that a for-profit structure would eventually be necessary and published internal materials to support that claim.

One of the sharpest details in the post is the claim by OpenAI that Musk himself was involved in moving the structure forward in 2017, including the claim that a public benefit corporation structure was created as part of those discussions. It does not resolve the legal dispute, but it changes the texture of the story because it shifts the frame from pure betrayal to a more complicated record fight over what each party wanted.

At the same time, Musk’s other AI fight is not related to governance or valuation. It is about outputs.

On January 16, California Attorney General Rob Bonta announced he sent Musk’s company xAI a cease-and-desist letter demanding immediate action to stop the creation and distribution of nonconsensual sexual deepfake imagery and content described as child sexual abuse material, tied to Grok.

The legal focus has been on a specific abuse pattern that has become a widely used term in the reporting and online discussion, AI nudification, which is being treated as a distinct category of harm rather than generic unsafe content.

This is also landing in a moment when the civil-liability profile in California concerning sexually explicit deepfakes is being watched closely, including under the newer framework often discussed as AB 621, which has been analyzed as strengthening plaintiff and enforcement leverage after notice.

xAI said it implemented new restrictions limiting certain image-editing capabilities, while the testing still found the system could generate explicit material privately at the time.

The pressure is not confined to California. Japan has launched its own probe into Grok over inappropriate images, and Economic Security Minister Kimi Onoda warned that the government would examine options including legal measures if safeguards are not immediate.

This is important because it turns the controversy from a single-state enforcement risk into a major-market compliance problem. Taken together, Musk is pressing one of the biggest AI damages demands on the table while regulators are forcing a second argument onto his own products, one that is less about what a company promised in its founding documents and more about what its systems are actually producing in the wild.

 Both stories are being fought with evidence now, and that is what is giving this week’s Musk AI cycle its unusual intensity.