Transcript generated automatically by AI and may contain errors.
Chapter 1: What is the main topic discussed in this episode?
We have a great show for you today, folks. We have a bunch of guests and a bunch of news stories to go through. Of course, the trial is ongoing. Did you say that this might be the last week of the trial? I thought it was a four-week trial, but it sounds like it might wrap up in week three.
Are they ahead of schedule? Yeah, Mike Isaac said it might end this week. I assume just because they're getting through the, like, you know, depositions, whatever, faster.
Yeah, I mean, it seems like Ilya has gone, Mira's gone, deposition from Paul Toner, and Siobhan Zillis, and then Sam's on the stand right now, I think. Mike Isaac is live-tweeting it, so we'll run through that. Sam Altman took the stand in the OpenAI versus Elon Musk trial this morning. Just as a reminder, here's what's at stake per The Wall Street Journal.
Musk is suing OpenAI and its leaders, Altman and Greg Brockman, for allegedly manipulating him into giving tens of millions of dollars to a nonprofit organization only for them to turn the AI lab into a for-profit venture. Musk is also suing Microsoft, OpenAI's largest investor, for aiding Brockman and Altman in their alleged deception.
So big turning point in the trial was last Wednesday when former OpenAI CTO Meera Muradi and former board member Helen Toner gave testimonies about the events leading up to the November 2023 failed board coup
that were critical of Sam Altman's leadership style and candor, they call it the blip, where Sam was out and then back very quickly with a couple other people stepping into CEO for just a few days. But last week, OpenAI's side also began to land some punches on Musk. Earlier testimony from Siobhan Zillis and Greg Brockman also
had already suggested Musk was not just defending a pure nonprofit vision. He explored scenarios where OpenAI might become a part of Tesla, where Altman might help lead Tesla AI, and where Musk could retain deep control. Brockman also testified that Musk supported a for-profit conversion if Musk could control it, including a version tied to raising money for his Mars ambitions.
Yesterday, Microsoft CEO Satya Nadella and OpenAI co-founder Ilya Sutskever took the stand. Satya largely buffed OpenAI's side, defending Microsoft's partnership with the company and saying that Musk never contacted him to complain about the deal, violating any agreement Musk had with OpenAI's nonprofit. despite Musk having Satya's number.
Ilya testified that he spent a year compiling a 50-page document documenting Sam's manipulative behavior, but also said he never promised Musk that OpenAI would remain permanently non-profit. Also, it came out in the trial that Sutskever's stake in OpenAI is probably worth around $7 billion, which probably complicated how the judge and jury feel about his own motivations.
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Chapter 2: What is the main focus of Sam Altman's testimony in the OpenAI trial?
And he, I guess, was playing, I don't think intentionally playing into the meme potential, but certainly that's how it played out. Ilya said under oath in a federal court, if there's no funding, there's no big computer. Max F says in the running for quote of the year.
If there's no funding, there's no big computer, and you need big computer if you want big AI. Sam Altman takes a stand in Musk versus OpenAI. Mike Isaac has a live blog going on X under Rat King. Let's run through some of what Mike Isaac is finding. OpenAI begins questioning Altman much in the same way that the plaintiff's side had questioned Elon Musk, establishing that Altman, like Musk,
has been enamored with AI for years and wanted to build inventive things with it. This was a very interesting tidbit from that original, that viral quote from Sam where he's like, AI will probably destroy the world. That happened in 2015 and it was an answer to a question of like, what do you think the key problems to solve are?
And then the next sentence in that quote that always gets clipped out is like, and I'm starting a company, well it's more of a nonprofit, to work on this problem exactly. But that doesn't make it in. So they were clearly both very interested in building beneficial AI, although they ultimately butted heads. And they were also very worried about Google.
Altman email from 2015, been thinking a lot whether it's possible to stop humanity from developing AI. I think the answer is almost definitely not.
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Chapter 3: What are the implications of Musk's lawsuit against OpenAI and its leaders?
If it's going to happen anyway, it seems like it would be good for someone other than Google to do it first. Altman said Musk once said, he would potentially pass control of OpenAI to his children upon his death.
I would love to know more about what that means because if you fracture it into like 20 different children at a certain point, like that can create a whole different dynamic of like a succession, right? There's an old email that says Altman might have joined the board of Tesla as part of old AI discussions. Also came with a nascent threat of Musk doing this AI work inside of Tesla.
Very, it would be a shame if you didn't accept my offer sort of moves. The Tesla offer is interesting, says Mike Isaac. Musk offers a board seat. Altman says it was something he felt was to assuage concerns that Altman would have no direction over the development of AI if it were folded into Tesla. But Altman also said it appeared to be a nascent threat.
If Altman had not accepted the idea, according to him, Musk hinted that he may have done work developing AI on his own at Tesla regardless. And Mike Isaac gives some more context here. He says, this sort of talk is fairly commonplace these days on the battlefield that is Silicon Valley. Mark Zuckerberg, Meta's CEO, has in the past made overtures to companies he's interested in acquiring
though he is often more explicit about his intentions. If you don't take the deal, we'll come for you. Tony Soprano vibes. Altman is criticizing stack ranking of engineers across AI labs, something Musk loves to do across his companies apparently, and something very common across big codes like Meta and Amazon. And also Microsoft is known for the stack ranking.
They almost invented it or certainly popularized it throughout the 90s and 2000s, I believe. Altman says AI engineering labs need more psychological safety. You have to be willing to let a researcher go off and try something random in the corner, very bottoms up. This is where the deep research project came from and a bunch of other AI breakthroughs came from.
Altman says there was a meeting at Tesla during the evening about folding OpenAI into Tesla for AI research. And then a long, long period of time with Elon showing us memes on his phone. And apparently the court reporter asked Sam Altman to repeat memes on his phone loudly. I don't know why they didn't hear it the first time. Rat King, Mike Isaac is laughing at this. One of us.
I am going to have Sam Altman stating memes on his phone into a booming courtroom mic playing inside of my head on repeat for the week. MEMES ON HIS PHONE in all caps. Getting hungry. He only had a banana this morning. Mike Isaac is suffering. His stamina points are draining.
And he says, LOL, email between Altman and Siobhan talking about how to handle Musk and Altman telling him about a Microsoft investment. So Microsoft's going to invest. How should we tell Elon? Altman narrates the email verbatim. Hopefully it's easy. Cross fingers emoji because you have to read it out. So really funny to hear cross fingers. Here's an emoji in the court record.
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Chapter 4: How did Microsoft defend its partnership with OpenAI during the trial?
This goes to the heart of how Musk's counsel has tried to portray Altman across the entirety of the trial, a fundamentally slippery operator who says one thing to one party and something else entirely to others. Opening Eye's rebuttal to that line of thinking has been
to depict a board of directors at OpenAI rife with dysfunction, and as Microsoft's Satya Nadella put it earlier in this week, directors who were operating from amateur city. Interesting. Taking shots of the board. Okay, Sam is giving a full jury Sam treatment, again, trying to bat back against Musk's picture of Altman as a serious liar.
If I knew how difficult and painful this was going to be, I never would have tried, but I'm very glad I did. Opening Eye is done. Cross-examination begins. Stephen Molo, lead Musk counsel, who has the flair for dramatic, will probably give us fireworks. And this is continuing. Says, oh my God, Molo, are you completely trustworthy? Altman says, I believe so.
Molo says, do you always tell the truth? Wow, this is getting heavy. It's all about Musk counsel painting Sam as a liar. Brutal. Altman is on the defensive. But taking more of a muted tone with some attempted humility in his voice is very clear contrast with how Musk appeared combative on the stand. Interesting.
Cross-examination is basically Musk's lawyer, Molo, reading off a list of questions saying, hey, bro, do you remember all this messed up stuff you did? And Altman saying, no, I don't know. Not true. No? Absolute chaos. Well, you can follow along at Mike Isaac. He has a whole thread and he's live posting. And I believe that there's a New York Times live blog as well that you can follow along with.
Should we talk about SPVs? Yes, let's move over to SPVs, the Special Purpose Vehicles.
Posts are rocking the valley right now.
People are raking in the dough with SPVs.
But not everyone's happy about it. Yeah, we can actually go down a little bit and pull up this post, which has since been deleted.
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Chapter 5: What were the significant testimonies that impacted the trial's direction?
Just the compliance to actually get your own broker dealer. Even there's people that I know that just use secondary transactions. They don't even have their broker dealer license. They work under a firm that does. They basically contract with a firm. So they're kind of almost like a real estate agent working under a broker.
I'm smelling an intern challenge, Tyler.
Get your broker dealer license. Figure out a way to use AI to bring down the compliance burden. Slash goal.
Throw that slash goal down. Get me a broker dealer license. X high. X high. 5.5 codex. Yeah. And try and get your broker dealer license in one shot. Let's see what it does.
Yeah. Turns out that if you want to broker... securities transactions. There's a big regulatory burden for good reason, right? We're talking about transactions that are at the scale of high-end residential real estate in this case. If this individual was maybe getting like a 5% fee on the deal, paid in cash, Who knows? It could have been, you know.
Wait, there is another take here, which is that there's the term brokering, which requires the broker-dealer license. But there is also the format where you set up an SPV. The SPV takes in money from an investor and then buys secondary from someone who has the right to sell it. maybe an investor who is not subject to the form that we saw Anthropic put out, right?
And in that case- Well, we'll get to that. We'll get to that. But hypothetically, there are SPVs that they are not technically brokering the secondary deal, but they are facilitating it, and they do take a fee, right? Because SPVs often have fees associated with them. And that does not require a broker-dealer license, right? Yeah. So it's possible.
But the straightforward interpretation of the post was that they had some sort of side letter, which was like, if I can find you a buyer for $100 million of your shares, you give me $5 million. That happens a lot, but it usually and hopefully is happening through legal channels. So this seemingly prompted both Andropic and OpenAI.
Oh, yeah, I think this is what started it, right?
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