The $134 Billion Gambit: Musk Sues OpenAI While California Crackdown Hits xAI

In a legal move against OpenAI and Microsoft, Elon Musk has demanded a staggering $134 billion in restitution, according to Bloomberg. Simultaneously, California Attorney General Rob Bonta served a cease and desist order on Musk’s artificial intelligence venture, xAI, demanding an immediate halt to illicit activities involving the Grok chatbot and non-consensual imagery.

The order alleges that Grok can generate explicit content, including non-consensual deepfake imagery, and that xAI developed a “Spicy Mode” to facilitate this as a marketing stratagem, with the state demanding a formal account of corrective measures within five days.

In the court filings, Musk asserts a damages claim ranging from $79 billion to $134 billion, citing OpenAI and Microsoft’s perceived “unjust enrichment” through their partnership, and notes he provided $38 million in seed funding—about 60% of the non-profit’s initial capital. The article also notes OpenAI’s current valuation at $500 billion, and that xAI faces regulatory headwinds in California amid the controversy surrounding Grok.