Case filed: Elon Musk sues Apple and OpenAI in bold, complex legal showdown
Grievances centre around 'exclusive' Apple-Altman AI partnership, deemed anti-competitive
Elon Musk has filed a landmark lawsuit against Apple and OpenAI.
Musk's main target: The "exclusive" Apple-OpenAI partnership, which he alleges is an "anti-competitive" move.
It's a complex, and potentially precedent-setting case.
Now, the AI heavyweights just stepped into the ring:
In the blue corner (as plaintiffs) are Musk's tag team — X Corp and xAI —ready to swing.
In the red corner (defendants), Apple and OpenAI — gearing up to defend their turf.
Ding ding, Round 1:
Why did Musk sue Apple and OpenAI?
Elon Musk, through his companies X Corp and xAI, filed a lawsuit against Apple and OpenAI, alleging that the two tech giants engaged in an anti-competitive scheme.
The underlying motive of the Apple-OpenAI deal is to keep monopolies in the smartphone and generative AI chatbot markets, Musk's camp alleges.
The case seeks significant damages and injunctive relief.
Test case
Legal experts see it as a "test case" for AI market regulation.
For one, Apple’s market dominance potentially supports Musk’s claims. Apple has not said a word about it, but legal minds say the tech giant could argue its actions are lawful business decisions.
The outcome, however, remains uncertain.
Going forward, the case could reshape AI competition and Big Tech’s partnership models.
Musk’s companies claim this arrangement unfairly prioritises ChatGPT in Apple’s App Store rankings and limits the visibility and competitiveness of xAI’s chatbot, Grok, and the X app.
Anti-trust law violated?
The lawsuit argues that this deal violates antitrust laws by creating barriers for competitors, stifling innovation, and reinforcing Apple’s dominance in the smartphone market (approximately 65% of the U. market) and OpenAI’s control over the generative AI chatbot market (roughly 80% in the US).
The complaint also alleges that Apple’s integration of ChatGPT gives OpenAI access to valuable user data from millions of iPhone users, which competitors like xAI cannot access due to the exclusive nature of the deal.
This, Musk’s firms argue, entrenches OpenAI’s market lead and hinders competitors’ ability to scale.
Super-apps
Additionally, the lawsuit claims Apple is attempting to protect its smartphone monopoly from “super apps” (like those developed by X and xAI) that could disrupt its market dominance by offering AI-driven functionalities that reduce reliance on expensive iPhones.
Musk’s legal action builds on prior threats he made earlier this month, when he accused Apple of manipulating App Store rankings to favour OpenAI, citing Grok’s high user ratings (4.9 average from a million reviews) yet its absence from Apple’s “Must Have” section.
This lawsuit is also part of Musk’s ongoing feud with OpenAI, which he co-founded in 2015 but left in 2018, and follows a separate lawsuit against OpenAI and its CEO, Sam Altman, for allegedly abandoning its nonprofit mission.
Which court?
The lawsuit was filed on August 26, 2025, in the US District Court for the Northern District of Texas.
Musk’s choice of Texas aligns with his strategy to litigate in the state, where he has relocated several of his companies’ headquarters to avoid jurisdictions like Delaware.
Facts of the case:
Here's the low-down on Musk's gripes against Apple and OpenAI:
Apple and OpenAI’s 2024 partnership integrates ChatGPT into Apple’s ecosystem, giving it "preferential treatment" in App Store rankings and system functionalities.
The exclusive deal allegedly violates Sections 1 and 2 of the Sherman Antitrust Act, which address monopolisation, attempted monopolisation, and conspiracy to monopolise, as well as Texas state competition laws.
The arrangement limits competition by reducing visibility for competing AI apps like Grok and X, and provides OpenAI with exclusive access to user prompts and data, enhancing its AI model while competitors are disadvantaged.
Apple’s actions are portrayed as a response to its lagging AI capabilities, with the partnership seen as a move to protect its smartphone monopoly against AI-driven “super apps.”
Relief Sought: xAI and X seek billions of dollars in damages and a court order to prohibit the alleged anticompetitive practices.
What Apple said
Apple has not commented, but previously stated its App Store is “fair and free of bias.”
In defence, some experts suggest Apple could counter that its partnership with OpenAI was a legitimate business decision in a competitive environment.
Apple has no legal obligation to promote competitors’ apps. It could also argue that security or operational reasons justify its integration choices.
Herbert Hovenkamp from the University of Pennsylvania Law School emphasised that Apple might defend its actions as "necessary" for user experience or system integrity.
What other legal experts are saying
Antitrust experts have provided mixed perspectives on the case:
Support for Musk’s Claims: Some experts believe Apple’s dominant position in the smartphone market (65% in the U.S.) could strengthen xAI’s argument that Apple is illegally tying iPhone sales to ChatGPT’s integration.
The exclusive deal could be seen as limiting competitors’ access to a critical market platform (the App Store).
Christine Bartholomew, a professor at the University at Buffalo School of Law, a seven-time winner of the school's only teaching award, noted that the case could be a “canary in the coal mine” — an early warning of danger — for how courts define and regulate the AI market, a novel issue in antitrust litigation.
Precedent-setter
The lawsuit could set a precedent for defining the US AI market in antitrust law, determining whether exclusive partnerships like Apple-OpenAI’s are permissible.
It may also influence how regulators view Big Tech’s AI strategies, especially given existing scrutiny of Apple’s App Store practices (e.g., the Epic Games case) and Google’s search monopoly.
What is the expected outcome?
Predicting the outcome is challenging.
The case is novel. The antitrust law in the AI sector is also complex.
Challenges for Musk: Musk’s claims face hurdles. Courts may find that Apple’s partnership with OpenAI is a standard business practice, not an illegal monopoly. Evidence from X’s Community Notes and reports indicate that other AI apps (e.g., DeepSeek, Perplexity) have reached No. 1 on the App Store, undermining Musk’s claim of exclusive favouritism. Additionally, OpenAI’s counterclaims of harassment and Musk’s history of litigation against them could weaken his credibility.
Potential for success: If Musk’s team can prove that Apple’s actions demonstrably suppress competition (e.g., through data exclusivity or biased rankings), the case could gain traction, especially given Apple’s prior antitrust scrutiny. A ruling against Apple could force it to open its platform to more AI providers, fostering competition.
Likely scenarios
The case may not reach a full trial, as many antitrust lawsuits settle.
However, if it proceeds, it could take years, given the complexity of defining the AI market.
A court ruling could either uphold Apple’s right to choose partners or mandate changes to its App Store and AI integration policies.
The outcome could also hinge on whether courts view the AI chatbot market as distinct and monopolised.
Currently, this is untested territory.
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