Jan 10 (Reuters) - U.S. antitrust enforcers weighed in
on Friday on Elon Musk's lawsuit seeking to block OpenAI's
conversion to a public company, pointing out legal doctrines
that support his claim that OpenAI and Microsoft ( MSFT )
engaged in anticompetitive practices.
The U.S. Federal Trade Commission and Department of Justice
were not expressing an opinion on the case, but offered legal
analysis on aspects of the case ahead of a Tuesday hearing in
Oakland, California. Musk co-founded OpenAI and owns AI startup
xAI.
A spokesperson for Microsoft ( MSFT ) declined to comment.
A spokesperson for OpenAI referred to a court document where
the company said the lawsuit lacks evidence and amounts to
harassment.
Musk's lawyer Marc Toberoff said, "the participation of the
DOJ and FTC is a sign of how seriously regulators take OpenAI
and Microsoft's ( MSFT ) misconduct."
The FTC is separately looking into partnerships in AI,
including between Microsoft ( MSFT ) and OpenAI, investigating
potentially anticompetitive conduct at Microsoft ( MSFT ) and probing
whether OpenAI violated consumer protection laws.
Musk alleges OpenAI violated antitrust law by making
investors agree not to invest in rival artificial intelligence
firms, and by sharing board members with Microsoft ( MSFT ), which is
also a defendant in the lawsuit.
OpenAI has said the board member claims are moot, because
Microsoft ( MSFT ) board member Reid Hoffman, who was on OpenAI's board,
and Microsoft ( MSFT ) executive Deannah Templeton, who had an observer
seat, are no longer affiliated with it.
But even after they leave boards, directors could still have
sensitive competitive information, the FTC and DOJ said. Board
members who only have observer status are not exempt from the
law, the authorities said in their brief.
Musk also claims that OpenAI facilitated a group investor
boycott against its rivals. Such claims are viable even when the
organizer of the boycott is not a member, the FTC and DOJ said.