Sources say OpenAI investors are considering suing the company’s board of directors
IT House News on November 21, Reuters quoted people familiar with the matter as saying that some investors in OpenAI are considering taking legal action against the company’s board of directors and are currently discussing with legal advisors.
Previously, the OpenAI board of directors announced the dismissal of Sam Altman, triggering a massive wave of employee departures.
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Investors are worried that the hundreds of millions of dollars they invested in OpenAI could suffer “catastrophic losses” as the popular business appears to be at risk of collapse.
OpenAI’s board of directors fired Altman last Friday citing a “breakdown in communication,” and Microsoft CEO subsequently announced that Altman would join Microsoft. As of Monday local time, most of OpenAI’s more than 700 employees were threatening to resign unless the company replaced its board of directors.
Minor Myers, a law professor at the University of Connecticut, pointed out that its employees have more leverage than capitalists.
For venture capital investors who typically have board seats or voting rights in their portfolios, OpenAI is controlled by its non-profit parent company, OpenAI Nonprofit, which was founded to “benefit humanity, not OpenAI investors.” .
IT House inquiries found that Microsoft currently holds 49% of the company’s shares, other investors and employees control 49%, and OpenAI’s non-profit parent company only holds 2% of the shares.