OpenAI has reportedly secured a legal victory against xAI. The dispute with xAI has been ongoing for a while, with allegations of theft. OpenAI was accused of using business secrets and secret information, and of employee poaching.
This lawsuit against OpenAI was dismissed by a US court on Tuesday, 24 February 2026. Take a look at what exactly happened between the two tech giants.
Reports allege that the lawsuit claimed two ex-xAI employees “stole its source code during their departure at a time when they were communicating with an OpenAI recruiter.” However, OpenAI was granted a dismissal by Rita F. Lin, a US District Judge.
The dismissal leaves room for amendment. xAI can refile the case if it needs to update or change its claim. Lin explained that, ‘there is no allegation that the recruiter told them to do so.’
OpenAI expressed its support of the court’s judgment: “We welcome the Court’s decision. This baseless lawsuit was never anything more than yet another front in Mr. Musk’s ongoing campaign of harassment.” This reaction followed the latest post on X, a social media platform.
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xAI also accused other ex-OpenAI staff members of other actions against the company. According to xAI, two employees “retained work chats on their devices after leaving xAI.” The AI company also accused another staff member of “refusing xAI’s demands to provide various certifications about confidential information after his departure.”
Another ex-employee was allegedly said to have “unsuccessfully tried to access xAI information about hiring and datacenter optimization after he started working at OpenAI,” while two other employees “simply left xAI for OpenAI.”
Despite the heavy accusations, the District Judge pointed out that none of them proved that OpenAI engaged in illegal activities. Lin also explained, “Notably absent are allegations about the conduct of OpenAI itself.”
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