Elon Musk-Sam Altman trial continues with Microsoft’s Sat Nadella testifying against OpenAI

Elon Musk, who is suing the artificial intelligence lab OpenAI and its president, Sam Altman, for allegedly defrauding him out of tens of millions of dollars, had his first witness take the stand this week. Microsoft Corporation President Satya Nadella testified for Musk on Monday in the federal jury trial.

First, Satya Nadella introduced himself to the jury as the president of Microsoft. Then, he described the company’s involvement with OpenAI when it started, and it was risky, innovative, and lacking sufficient funding.

In his testimony, Satya emphasized how excited Microsoft was to work with OpenAI because “no one else was willing.” Elon Musk accuses the defendants of deception, in which Altman and Brockman convinced him to invest tens of millions of dollars in a nonprofit project, but they steered the lab towards a profit-making business model. In addition, Musk claims that Microsoft assisted in this alleged fraud.

According to the plaintiffs, the court should strip the defendants’ positions and transfer up to $180 billion from the for-profit part of OpenAI to the nonprofit parent company.

Satya tells the court Microsoft backed OpenAI for business reasons from the start

As part of the trial, the focus has also shifted to Microsoft’s investments in OpenAI. It started in 2019 when Microsoft provided the AI lab with $1 billion worth of services. In addition, the company doubled its investment two years later, and in 2023, it invested another $10 billion in the company. Thus, Microsoft has invested almost $13 billion in OpenAI.

Musk expressed his concerns about these investments earlier. As Elon Musk pointed out in an interview last month, he was worried that “they were trying to steal the charity.”

It seems that Satya Nadella saw the matter differently. The president of Microsoft highlighted that the corporation never provided donations to OpenAI. Instead, it was a commercial arrangement, and it is crucial to Elon Musk’s case as he focuses on OpenAI’s nonprofit mission.

Besides, Satya Nadella mentioned that Microsoft offered OpenAI significant discounts on compute resources because of the computational complexity required to develop state-of-the-art AI models. In addition, Azure provided a perfect platform for OpenAI, and Microsoft expected marketing benefits from this partnership.

Former OpenAI board member Tasha McCauley recorded that the board briefly considered removing Sam Altman from the CEO position in 2023. Moreover, she revealed that Satya Nadella contacted other board members and asked to return to pre-Sam dismissal times.

This testimony once again brought the company’s involvement into the discussion. Elon Musk argues that the interests of Microsoft are different from those of OpenAI’s nonprofit mission. From the stand, Elon Musk asked, “With all due respect to Microsoft, do you really want Microsoft controlling digital superintelligence?”

However, in October 2025, OpenAI recapitalized, and the nonprofit remained the parent organization while retaining ownership of the for-profit division. In this situation, Microsoft retained approximately 27% of the value of OpenAI’s for-profit branch, worth nearly $135 billion.

Microsoft and OpenAI relationship becomes increasingly strained

Moreover, in recent months, the Microsoft-OpenAI collaboration became increasingly strained. In late January 2025, just as jury selection in Musk v. Altman was getting underway, Microsoft and OpenAI agreed on changes to their collaboration agreement.

In particular, the updated agreement allows OpenAI to limit its revenue share and offer the product to customers through any cloud provider.

Microsoft calls the new agreement a simplification of the partnership. However, for the jury, the case is essentially reduced to one question: Has OpenAI adhered to its nonprofit principles, or have financial motives, computing power, and corporate management led it astray?

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