OpenAI has reversed its decision to cede control of ChatGPT and its other AI products to a new public-benefit corporation (PBC), which will now give ongoing authority to the nonprofit arm of the company.
The reconfiguration still requires approval from attorney general offices in California and Delaware before early next year, with any rejection potentially resulting in a $30bn funding cut from SoftBank and other investors that could impact its position in Generative AI.
The original 2015 structure of OpenAI was as a nonprofit research lab, but the need to raise significant funds for advanced AI development led to the push to become a PBC, which received strong opposition, including from Elon Musk, who sued for breach of contract in 2024.
A US federal judge ruled last week that many of Musk’s allegations could proceed to trial, and while OpenAI believes the latest plan resolves the lawsuit, Musk is reportedly pushing ahead to trial.
Nonprofit supporters are now calling for California attorney general Rob Bonta to ensure the new plan gives the nonprofit adequate resources and independence from the for-profit sister company.
