In a significant development in the AI legal landscape, a California federal judge dismissed a lawsuit by Elon Musk’s xAI against OpenAI, which accused it of stealing AI trade secrets and poaching employees. US District Judge Rita F. Lin highlighted a lack of evidence linking OpenAI to any misconduct, emphasizing that xAI’s claims stemmed from the actions of eight former employees who transitioned to OpenAI. The court found no proof that OpenAI directed these individuals to misappropriate confidential information or used any allegedly stolen data. While OpenAI hailed the dismissal as a victory, labeling the lawsuit “baseless,” the judge allowed xAI to amend its claims and refile by March 17, 2026. Meanwhile, Musk is concurrently pursuing a multi-billion dollar lawsuit against OpenAI over its transition from a non-profit to a for-profit structure, with a jury trial set to begin this April. The legal saga continues.
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