Musk vs. Altman in Court, and AI’s Underpants Problem

Elon Musk and Sam Altman are heading to court this week, and the stakes couldn’t be higher. At issue is the future of OpenAI—specifically whether it can go public as a for-profit company. Musk, one of the original co-founders, claims he was tricked into funding the nonprofit under false pretenses. He wants $134 billion in damages, Altman and president Greg Brockman out, and OpenAI returned to its charitable roots.

This isn’t just a messy breakup. The ruling could upend the global AI race. If the court sides with Musk, it might force OpenAI to restructure or even oust its leadership right before a planned IPO. That’s a big deal for anyone watching how AI companies balance mission and money.

Meanwhile, Will Douglas Heaven at MIT Tech Review nailed it with a South Park analogy. Remember the underpants gnomes? Phase 1: Collect underpants. Phase 2: ? Phase 3: Profit. That’s basically AI right now. Companies have built the tech (Phase 1) and promised transformation (Phase 3). But how they get from here to there is still a giant question mark. The missing step between hype and profit is real, and nobody has cracked it yet.

On top of all that, we’re now living in the age of weaponized deepfakes. Cheap, accessible models are churning out sexually explicit images and political propaganda that look startlingly real. Experts are alarmed because these things are already inciting violence, changing minds, and destroying trust—especially for women and marginalized groups. It’s not a future threat; it’s happening now.

Also worth noting: OpenAI ended its exclusive partnership with Microsoft, allowing it to court rivals like Amazon. Microsoft still licenses the tech, but exclusivity is gone. And OpenAI is reportedly missing key growth targets ahead of its IPO. Meanwhile, Google signed a classified AI deal with the Pentagon for “any lawful government purpose,” despite over 600 workers calling for a block. AI firms are now training military versions of their models on classified data.

This is a lot to digest in one week. But the core tension is clear: AI is powerful, profitable in theory, and messy in practice. The courtroom drama, the profit gap, and the weaponization problem are all symptoms of an industry moving faster than its own guardrails.