Meta wants to stop OpenAI from becoming a for-profit entity
Meta Platforms has petitioned California's Attorney General Rob Bonta, to stop OpenAI from transitioning from a non-profit to a for-profit organization. According to The Wall Street Journal, Meta expressed its concerns in a letter, arguing that the transformation could set a dangerous precedent for start-ups to exploit non-profit benefits before becoming profitable. The company highlighted the potential implications for Silicon Valley, where non-profit investors could benefit from for-profit gains and tax write-offs.
Transition could have 'seismic implications'
Meta's letter to the Attorney General emphasized the possible effect of OpenAI's proposed shift. "OpenAI's conduct could have seismic implications for Silicon Valley. If OpenAI's new business model is valid, non-profit investors would get the same for-profit upside as those who invest the conventional way in for-profit companies while also benefiting from tax write-offs bestowed by the government," Meta said..
OpenAI seeks dismissal of Musk's lawsuit
On the same day as Meta's appeal, OpenAI asked a federal judge to dismiss Elon Musk's plea to block its conversion. Musk had filed a lawsuit against OpenAI and its CEO Sam Altman in August, accusing them of prioritizing profits over public welfare. In November, he had sought a preliminary injunction from US District Judge Yvonne Gonzalez Rogers in Oakland against OpenAI's structural change.
Restructuring aims to ensure non-profit's survival
OpenAI Chairman Bret Taylor has said any restructuring would be focused on ensuring the non-profit's continued existence and mission fulfillment. Meta has voiced its support for Musk's efforts to represent public interests in OpenAI's potential for-profit status, as per WSJ. Musk, a co-founder of OpenAI, has since founded a competing AI company called xAI.
