Meta urges California court to prevent OpenAI from becoming a for-profit company

ChainCatcher news, according to IT Home citing The Wall Street Journal, Meta is urging California Attorney General Rob Bonta to block OpenAI's plan to transition into a for-profit entity, marking its stance alongside Musk in the battle between the two AI giants in Silicon Valley.

In a letter sent to California Attorney General Rob Bonta on Thursday local time, Meta stated that allowing OpenAI to transition into a for-profit company would set a dangerous precedent for startups, enabling these companies to continue enjoying the tax benefits of non-profit organizations before they are ready to turn a profit.

Meta wrote in the letter: "OpenAI's actions could have far-reaching implications for Silicon Valley. If OpenAI's new business model is accepted, then non-profit investors will gain the same profit opportunities as those investing in traditional for-profit companies, while still benefiting from government tax breaks."