A coalition of labor and nonprofit organizations is urging California's attorney general to prevent OpenAI from becoming a for-profit entity

Nonprofits urge California AG to stop OpenAI's profit shift.

: Nonprofits and labor groups are petitioning California Attorney General Rob Bonta to prevent OpenAI from transitioning into a for-profit company. The coalition, including LatinoProsperity and California Teamsters, argues that OpenAI is diverting from its mission to advance safe AI to focus on profits. OpenAI, which started as a nonprofit, currently operates under a dual structure with a for-profit arm overseen by a nonprofit. Critics are concerned about OpenAI's potential to benefit select investors while neglecting its charitable mission.

A coalition of nonprofit and labor organizations has taken action to challenge OpenAI's potential transition from a nonprofit research entity to a for-profit organization. The coalition, involving notable groups such as LatinoProsperity and California Teamsters, has petitioned California Attorney General Rob Bonta to scrutinize and potentially halt OpenAI's trajectory towards a corporate model. These organizations argue that OpenAI, which initially dedicated itself to developing safe and ethical artificial intelligence, may now be prioritizing financial gains over its foundational charitable mission.

OpenAI’s strategic shift to become a public-benefit corporation was announced in 2024 with a timeline suggesting it must be completed in two years. A delay or failure in this transition could result in a large portion of its accumulated funds transforming into debt. The core concern of the coalition is that this shift undermines the original promises of safeguarding and enhancing artificial intelligence for public good, thereby potentially redirecting valuable technological advancements towards lucrative opportunities for a narrow group of investors and stakeholders.

OpenAI was established with a unique operational model, intended to balance both nonprofit objectives and for-profit mechanisms. While the dual structure allows operational freedom within California's legal frameworks, this hybrid model has faced scrutiny. Critics argue that OpenAI is actively subverting its nonprofit charter to align with corporate interests, focusing on maximizing profits and providing exclusive advantages to high-level employees and select corporate shareholders.

In response to the coalition’s assertions, OpenAI has reiterated its commitment to its nonprofit origins. A spokesperson emphasized the board’s intention to fortify the nonprofit component to ensure it can fulfill its mission on a sustained basis. OpenAI has invited insights and guidance from community-based leaders, aiming to integrate their perspectives to support the organization's mission and objectives.

Additional pressure comes from other industry stakeholders, such as Meta and Elon Musk. A letter from Meta accused OpenAI's forthcoming structural change of potentially violating legal principles, a sentiment echoed by Musk's endeavor to acquire OpenAI to prevent the conversion. The unfolding debate illustrates the complex intersection of technological innovation, legal frameworks, and ethical considerations facing AI development in modern society.

Sources: Engadget, The Los Angeles Times

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