Microsoft’s CTO testifies about email at the heart of Elon Musk’s allegations against the tech giant

Microsoft CTO Kevin Scott testified in court that an internal email he sent in March 2018—cited by Elon Musk’s lawyers—was not questioning whether major donors like Musk knew OpenAI was shifting from nonprofit to for-profit. Instead, Scott said he was questioning whether OpenAI had the right to pursue commercial plans, given its original mission. He clarified the donor he referenced was Reid Hoffman, LinkedIn co-founder and a board member at both Microsoft and OpenAI, not Musk. During a dinner in late 2018 with OpenAI CEO Sam Altman and retired Microsoft executive Craig Mundie, Scott learned key details: Hoffman was investing in OpenAI’s new for-profit entity and joining its board. OpenAI was also raising a $500 million funding round, Altman was leaving Y Combinator to lead full-time, and the company had adopted a ‘capped profit’ corporate structure. Scott described the structure as ‘surprising and interesting,’ noting it was unlike anything he had seen before. Microsoft had not yet committed to investing when Scott testified. The company conducted extensive due diligence—technical, financial, legal, and governance—before proceeding. By June 2019, Scott and Microsoft CFO Amy Hood presented a confidential memo to the board, warning that Google had pulled ahead in AI and urging a $1 billion investment to close Microsoft’s ‘gaps in experience and talent.’ Without OpenAI, they argued, Microsoft risked falling further behind in building its own AI capabilities. The memo emphasized the need for a ‘frontier AI workload’ on Azure, as OpenAI’s scale would help Microsoft identify infrastructure needs. The board approved the investment, leading to a July 2019 announcement of a multi-year partnership. By early 2020, the collaboration had produced their first AI supercomputer, which OpenAI used to train GPT-3. Scott testified the partnership was a success, praising Microsoft’s infrastructure capabilities. Musk’s lawsuit alleges OpenAI misled donors, including himself, by converting the nonprofit into a for-profit venture with Microsoft’s support. Scott’s testimony provided context for the 2018 email, framing it as a concern about operational legitimacy rather than a broader critique of OpenAI’s mission shift.