OpenAI asks state AGs to probe Elon Musk's anti-competitive antics

OpenAI is taking the fight to Elon Musk’s doorstep just three weeks before their blockbuster trial begins.

On Monday, OpenAI sent a formal letter to the attorneys general of California and Delaware, urging them to investigate "improper and anti-competitive behavior" by Musk and his network of associates.

Jury selection is slated to kick off on April 27 in the Northern District of California, and OpenAI clearly has no intention of playing defense.

Coordinated attacks and flight tracking

In the letter, OpenAI strategy chief Jason Kwon accused Musk of running sustained sabotage campaigns against the company, alleging he has even been coordinating efforts with Meta CEO Mark Zuckerberg.

OpenAI Chief Global Affairs Officer Chris Lehane doubled down to CNBC, questioning why two of the four wealthiest people on the planet are actively colluding to hobble the AI lab.

Kwon also leaned heavily on a recent New Yorker investigation. The report revealed that Musk and his family office chief, Jared Birchall, ran extensive opposition research on OpenAI CEO Sam Altman.

According to the report, Musk’s operatives tracked Altman’s personal flights and daily movements, subsequently circulating hit pieces and fabricated allegations of sexual misconduct among industry rivals.

Back in January, OpenAI warned its investors and banking partners to brace for outlandish and fabricated claims from Musk, calling it his standard harassment playbook.

Turning the tables on Grok and SpaceX

OpenAI also connected the legal showdown to Musk's broader business empire.

SpaceX confidentially filed for what could be a record-breaking IPO just days ago. In its letter, OpenAI argued that Musk’s courtroom maneuvers are calculated to clear the runway for xAI’s Grok.

The letter explicitly mentioned that Grok is currently under international scrutiny for generating sexually explicit deepfakes of women and minors, allegedly to inflate user engagement ahead of SpaceX's public debut.

There is deep irony in OpenAI appealing to California and Delaware. Musk spent years blasting both states for anti-business bias, relocating Tesla and SpaceX headquarters to Texas and reincorporating his ventures in Nevada.

To make matters more tangled, xAI is currently suing California Attorney General Rob Bonta over the state's newly enacted AI data transparency rules.

Why it matters

This is no longer a polite boardroom dispute over OpenAI’s founding charter; it is total war between Silicon Valley’s biggest titans.

We think OpenAI’s legal counteroffensive is a calculated attempt to seize the moral high ground before the jury is seated. By framing Musk not as a noble safety advocate, but as a predatory competitor using dirty tricks to pump up xAI and SpaceX, OpenAI is attempting to dismantle his entire legal narrative.

For the broader AI ecosystem, the stakes could not be higher. An OpenAI loss could paralyze its planned restructuring into a full for-profit entity, disrupting multi-billion-dollar infrastructure deals and cooling investor appetite.

However, dragging state regulators into a personal tech vendetta looks like a dangerous gambit. Inviting antitrust probes sets a precedent that could easily backfire and invite tighter oversight on everyone in the AI race.