OpenAI has successfully convinced a court to dismiss a lawsuit filed by Elon Musk’s xAI, accusing the company of stealing its trade secrets. In her decision, US District Judge Rita F. Lin wrote that XAI’s complaint “does not point to any misconduct by OpenAI” and instead holds responsibility for all of the listed misconduct to its eight former employees, who “left for OpenAI around the same time.”
Lin said that XAI accused two of its former employees of stealing its source code before leaving, when they were already talking to an OpenAI recruiter. However, the company did not say whether the recruiter had asked those former employees to do so. XAI’s lawsuit also accuses two other former employees of keeping work conversations on their devices after they left, another of refusing to provide certificates related to confidential information after their departure, and another of unsuccessfully trying to access XAI recruiting and datacenter optimization information while they were already working for OpenAI.
“The allegations regarding OpenAI’s conduct are notably absent,” the judge said. xAI did not include any information that directly accused OpenAI of those employees stealing its trade secrets. It also did not include allegations that those former employees had used any stolen trade secrets while already working for OpenAI. To be precise, OpenAI’s motion for dismissal was granted with amendment allowed, so the lawsuit may not be completely over yet. This means XAI can still file an amended complaint addressing what the judge wrote in his ruling until March 17, 2026.
OpenAI and xAI have had a long-running feud, and this is just one of several lawsuits between the two companies. In fact, Musk has an ongoing complaint against OpenAI and Microsoft, accusing OpenAI and Microsoft of violating his non-profit status. Musk, who was an early funder of OpenAI, is now seeking damages ranging from $79 billion to $134 billion from the company’s “ill-gotten gains.”
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