xAI has filed a lawsuit in California federal court against ex-engineer Xuechen Li, alleging that he stole confidential information about its Grok chatbot — data Musk’s company claims could give OpenAI a competitive edge over ChatGPT.
According to the complaint, Li joined xAI in 2023 and worked on training and development of Grok, the company’s flagship chatbot. Earlier this year, he accepted a job offer from OpenAI, sold $7 million worth of xAI stock, and then allegedly copied company files before leaving. The lawsuit says Li admitted to taking documents and “covering his tracks” during an August 14 meeting, though further material was later found on his devices.
xAI argues the stolen data concerns “cutting-edge AI technologies with features superior to those offered by ChatGPT” and could help OpenAI strengthen its own chatbot. The startup is seeking monetary damages and a court order blocking Li’s move to OpenAI.
The case highlights not only the fierce race for talent in AI but also the growing personal and legal hostilities between Musk and his former company. Musk co-founded OpenAI in 2015 but has since become one of its sharpest critics. He is already suing OpenAI and CEO Sam Altman over claims the company abandoned its non-profit roots, while OpenAI countersued him in April for harassment.
Just this week, xAI also filed a separate case in Texas accusing OpenAI and Apple of monopolising AI chatbots on Apple devices.
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