Elon Musk escalated his legal battle against OpenAI and Microsoft on Friday, demanding between $79 billion and $134 billion in damages through a court filing that seeks to claw back what his lawyers call “wrongful gains” from the AI company’s shift to a for-profit model. The filing, submitted in federal court in San Francisco, argues Musk deserves a slice of OpenAI’s soaring valuation—pegged by some at $500 billion—stemming from his founding contributions of $38 million and early leadership. This move comes days after a judge greenlit a jury trial set for March, signaling the case’s momentum toward courtroom showdown.

Musk’s attorneys, led by Steven Molo, framed the demand as equitable relief under a legal doctrine known as disgorgement, which strips ill-gotten profits. “Just as an early investor in a startup company may realize gains many orders of magnitude greater than the investor’s initial investment, the wrongful gains that OpenAI and Microsoft have earned – and which Mr. Musk is now entitled to disgorge – are much larger than Mr. Musk’s initial contributions,” Molo wrote in the filing, as reported by Bloomberg.

The calculation ties directly to OpenAI’s valuation trajectory, with Musk’s team estimating his entitlement based on a 15% to 25% share of the company’s worth, adjusted for Microsoft’s deep involvement. This isn’t punitive damages but a bid to unwind benefits Musk claims violate OpenAI’s original nonprofit charter, which he helped draft in 2015 to advance artificial general intelligence for humanity’s benefit.

Roots of the Rift

Musk co-founded OpenAI in 2015 alongside Sam Altman, Greg Brockman and others, infusing it with initial funding amid concerns over AI risks. Tensions surfaced by 2018 when Musk resigned from the board, citing conflicts with Tesla’s AI work. OpenAI then pivoted, announcing a for-profit arm in 2019 backed by Microsoft’s billions, a move Musk alleges breached core agreements.

U.S. District Judge Yvonne Gonzalez Rogers ruled last week that sufficient evidence exists for a jury to weigh Musk’s breach-of-contract claims, rejecting OpenAI’s bid for summary judgment. “There is plenty of evidence to suggest OpenAI’s leaders made assurances nonprofit structure would be kept,” the judge noted, per TechCrunch. Newly unsealed documents reveal internal 2017 discussions among founders about sidelining Musk, including Brockman’s diary entry: “It’d be wrong to steal the non-profit from him… that’d be pretty morally bankrupt.”

Damages Blueprint Emerges

The $79 billion to $134 billion range reflects OpenAI’s rumored $500 billion valuation in funding talks, with Musk seeking disgorgement of profits linked to the nonprofit-to-profit transition. His lawyers argue Microsoft, as a key beneficiary through its multiyear, multibillion-dollar investment, shares liability. Posts on X from accounts like Sawyer Merritt highlighted the filing’s investor analogy, amplifying buzz among tech watchers.

OpenAI has countered aggressively, warning investors of Musk’s “deliberately outlandish” tactics ahead of trial, as noted by CNBC. The company maintains its structure complies with founding documents, emphasizing capped-profit returns for investors while pursuing its mission. Microsoft declined comment, but the trio’s entanglement—Microsoft’s Azure powers much of OpenAI’s compute—raises stakes for the software giant’s AI dominance.

Valuation Wars Fuel the Fire

OpenAI’s ascent from Musk-era nonprofit to AI powerhouse underscores the dispute’s stakes. ChatGPT’s 2022 launch propelled valuations from $29 billion in 2023 to today’s stratospheric levels, fueled by Microsoft infusions exceeding $13 billion. Musk’s xAI, valued at $50 billion, positions him as rival, yet he frames the suit as mission defense, not competition grudge.

Legal experts see disgorgement as novel here, akin to insider trading clawbacks but applied to nonprofit betrayal. “This could set precedent for founder rights in mission-driven ventures,” said one analyst quoted in Reuters. Musk’s net worth, nearing $700 billion per TechCrunch, hasn’t deterred claims, with his team insisting compensation mirrors startup norms.

Boardroom Betrayals Unraveled

Discovery has unearthed emails showing OpenAI leaders grappling with Musk’s influence. Brockman’s notes, unsealed recently, capture moral qualms over restructuring without him, per X posts from Tesla Owners Silicon Valley. Altman has testified the changes were necessary for scaling AGI safely amid competitive pressures from Google and others.

The trial, slated for March in Oakland federal court, will test verbal promises’ enforceability against written charters. OpenAI’s German arm even echoed the saga, with DW reporting Musk’s demands ripple globally amid Europe’s AI regulatory push.

Investor Jitters and Market Ripples

Jim Cramer warned on CNBC that the suit could scuttle OpenAI’s IPO dreams, forcing a pre-trial funding crunch. Musk’s resources—bolstered by Tesla, SpaceX—contrast sharply, per X sentiment. OpenAI’s backers, including Thrive Capital and Khosla Ventures, face valuation freezes if disgorgement sticks.

Beyond dollars, the case probes AI governance: Can nonprofits morph profitably without founder buy-in? Musk’s filings cite OpenAI’s $157 billion tender offer valuation as disgorgement baseline, arguing his sweat equity warrants outsized return. As trial nears, both sides brace for evidence dumps that could redefine tech philanthropy.

Trial Horizons and Beyond

With jury selection looming, OpenAI motions for dismissal faltered, but appeals remain possible. Musk’s prior suit dismissal in 2024 was refiled stronger, surviving scrutiny. Reuters detailed the ‘wrongful gains’ theory, linking damages to OpenAI-Microsoft synergies like Copilot integrations.

Industry insiders watch for fallout on xAI’s talent wars and Tesla’s Optimus robots. If victorious, Musk could redirect billions to his ventures, reshaping AI power dynamics. The filing caps a saga blending idealism, ambition and courtroom drama.