Major Shakeup at OpenAI in Midst of Legal Woes
OpenAI’s Removal of Altman Results in Major Shift of Players Move to Microsoft
After a whirlwind of activity at the highest levels of OpenAI over the weekend, the dust has finally settled, with the AI developer seeing the removal of co-founder and CEO Sam Altman, the loss of co-founder and President Greg Brockman, and the announcement of not one but two interim CEOs in less than 72 hours. Here’s the breakdown:
Chronology of Altman Exit:
On Friday, after reportedly notifying Altman and its largest investor, Microsoft, “just before” it went public, OpenAI announced Altman’s removal as CEO and named Chief Technology Officer Mira Murati as its interim CEO.
Within 24 hours, an internal OpenAI memo from COO Brad Lightcap identified the split as the result of a “breakdown in communication” between Altman and the Board. In short order, OpenAI co-founder and President Greg Brockman quit in light of Altman’s firing and his own removal from the Board.
Also by Saturday, as OpenAI employees expressed their support for Altman (some even leaving OpenAI in protest), early investor Khosla Ventures expressed its desire to have Altman back at the helm of OpenAI but clarified it would continue to support Altman “in whatever he does next.”
By Sunday, it appeared the Board was backpedaling, with reports surfacing that Altman was discussing a potential return.
Monday morning, Microsoft CEO Satya Nadella announced it had hired Altman, Brockman, and other former OpenAI colleagues to lead a new advanced AI team. OpenAI subsequently named Emmett Shear, former Twitch boss, as its interim CEO, allowing Mira Murati to return to her role as CTO.
While pushing for ongoing development, Altman has long been vocal about the dangers of AI and the need for responsible development of the technology, telling The Guardian in March of this year “We’ve got to be careful here” and acknowledging “we are a little scared of this.” Altman specifically noted concerns about large-scale disinformation and the use of AI technology for “offensive cyber-attacks.” In May, testifying before Congress, he urged lawmakers to pass new legislation embracing the promise of AI while mitigating its risks. Once again, he identified the circulation of disinformation and potential use of AI to manipulate voters as his “areas of greatest concern.” Still, Altman has described AI development as “the greatest technology humanity has yet developed” and his approach at OpenAI was all gas, no breaks. Prior to this weekend’s dust up, OpenAI was reported to be in talks with iPhone designer Jony Ive to raise $1 Billion to develop an AI device to rival the smartphone.
Reports coming out of the weekend are that Altman and the OpenAI Board were on divergent paths, with Altman wanting more aggressive development of the technology and a launch in the market sooner rather than later while the Board sought a more cautious approach forward.
With the realignment of these major players—Altman’s new boss, Microsoft, remains the largest investor in OpenAI with an up-front contribution of $13 Billion—it remains to be seen the path forward for OpenAI and the new “advanced AI group” to be fronted by Altman and staffed by Brockman and other former OpenAI colleagues. Also unclear is the impact the shakeup will have on pending litigation against OpenAI and whether those woes will extend to Altman and the new AI venture. What remains clear is that attention likely will continue to focus on OpenAI, Altman, Microsoft, and the new AI group in the coming months as developments are ongoing.
For more information about technology law, see our Technology & Data Law and Industry Focused Legal Solutions pages.
This article has been provided for informational purposes only and is not intended and should not be construed to constitute legal advice. Please consult your attorneys in connection with any fact-specific situation under federal law and the applicable state or local laws that may impose additional obligations on you and your company. © 2023 Klemchuk PLLC