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After an extremely complicated April 2025, Elon Musk is still facing some significant problems ahead as the market enters a new month.
Since it reported extremely disappointing Q1 earnings, Tesla has had to grapple with the fact that it failed to meet even Wall Street’s scaled-back expectations. Even after Musk announced plans to spend more time at his company and less time on Capitol Hill, TSLA stock has been highly volatile.
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Meanwhile, Musk’s other companies have problems of their own. His artificial intelligence (AI) startup xAI is reportedly in the process of raising $20 billion in a new funding round, but his other attempt to conquer the fast-growing market seems to be facing new obstacles.
For months, Musk has been locked in a legal battle with one of the industry’s hottest AI startups, maneuvering to stop a major transition it is planning. According to experts, he is facing a difficult road ahead.
Elon Musk’s court case is moving forward, but not necessarily in his favor
Over the past year, a new rivalry has come to dominate Silicon Valley, surpassing that of Bill Gates and Steve Jobs, a dynamic that shaped the personal computing boom of the 1980s. Musk has doubled down in his battle against OpenAI founder Sam Altman, someone with whom he once worked closely.
Related: Elon Musk gets more bad news from a new rival
An early investor in OpenAI, Musk also helped create and build the AI research organization, assisting in work that would lay the foundation for ChatGPT. However, he departed in 2018 over disagreements regarding its direction, sparking what would become a multi-year feud with Altman.
Last year, it reached a boiling point when Musk filed a lawsuit against OpenAI and Altman. In it, he claimed the startup’s attempts to transition from a nonprofit entity to a for-profit structure constituted both fraud and breach of contract, prompting him to seek a preliminary injunction to stop it.
In March 2024, U.S. District Judge Yvonne Gonzalez Rogers denied Musk’s attempt to block the transition on the grounds that he lacked the “high burden required for a preliminary injunction.”
But now the case is moving forward quickly in the direction of a trial. It is currently scheduled for March 2026, though both parties may want to expedite the process.
According to legal experts, Musk’s chances of winning his case against OpenAI don’t seem high. Arthur Dermendjian, a pre-litigation managing attorney at J&Y Law, spoke to TheStreet about the pending legal showdown between two tech-sector titans.