Sam Altman scores a win over Elon Musk as judge tosses xAI poaching suit
Business Insider
February 24, 2026
AI-Generated Deep Dive Summary
A California federal judge has dismissed a lawsuit filed by Elon Musk's AI startup xAI, which accused OpenAI of poaching employees to steal trade secrets. The court ruled in favor of OpenAI, led by CEO Sam Altman, citing a lack of evidence that OpenAI induced former xAI employees to misappropriate confidential information or used any stolen trade secrets. Instead, the complaint focused on eight former xAI employees who joined OpenAI around the same time but failed to demonstrate misconduct by OpenAI itself.
The case is part of an escalating legal feud between Musk and Altman, two tech billionaires with a history of disputes. Last year, xAI sued Apple and OpenAI, accusing them of monopolistic behavior, while Musk separately sued Altman and OpenAI over claims the company shifted from a nonprofit to a for-profit structure, allegedly betraying its original mission. OpenAI countersued, alleging that Musk's actions amount to a "years-long campaign of harassment." This latest ruling comes as their legal battles intensify.
The judge granted OpenAI's motion to dismiss xAI's trade secret misappropriation claims, noting that xAI did not provide sufficient evidence linking OpenAI to the theft or use of its secrets. The court emphasized that without allegations of misconduct by OpenAI or instances where former employees used stolen information, the case lacked merit. This decision marks a significant win for Altman and OpenAI, who have consistently denied the allegations, calling them part of Musk's broader efforts to intimidate competitors.
The ruling highlights the high-stakes legal landscape in the AI industry, where disputes over talent poaching and intellectual property are increasingly common. For business readers, this case underscores the importance of having concrete evidence when pursuing trade secret claims and the potential consequences of aggressive litigation strategies between major tech
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Originally published on Business Insider on 2/24/2026