Apple and OpenAI must face X Corp’s lawsuit for now, U.S. judge rules

An Apple logo adorns the facade of the downtown Brooklyn Apple store on March 14, 2020, in New York. (AP Photo/Kathy Willens, File)

Apple (AAPL.O) and ChatGPT maker OpenAI on Thursday failed to convince a federal judge to dismiss a lawsuit by Elon Musk’s X Corp accusing them of conspiring to monopolize markets for smartphones and generative AI chatbots.

In his ruling, U.S. District Judge Mark Pittman in Fort Worth, Texas, said Musk’s social media platform X and startup xAI can move forward for now with their lawsuit, in a preliminary victory for the billionaire entrepreneur in a battle over artificial intelligence dominance.

Pittman said in his brief order that his ruling should not be seen as a judgment on the merits of X’s allegations, and that he will look at disputes over fact at a later stage in the case.

Musk companies say Apple breached antitrust

Apple, OpenAI and X did not immediately respond to requests for comment.

Musk’s companies claimed in the lawsuit filed in August that Apple has violated antitrust law by exclusively integrating ChatGPT into Apple Intelligence features on iPhones and other Apple devices. The lawsuit alleged Apple had illegally shut out rivals in its partnership with OpenAI.

X and xAI also alleged Apple reinforced the exclusivity by featuring ChatGPT on its “Must-Have Apps” list while sidelining rivals in the App Store.

Apple, in seeking dismissal of the lawsuit, said its OpenAI deal is not exclusive and that the complaint fails to allege any agreement barring Apple from working with other chatbots.

“Choosing one partner first is not unlawful,” Apple told the court.

Apple denied any anticompetitive conduct, telling the court that other chatbots remain available through browsers and apps, and X and Grok rank high in App Store charts.

OpenAI, in responding to the lawsuit, accused Musk of waging “a campaign of lawfare” against OpenAI and ChatGPT. Musk is separately suing OpenAI and its leaders in a federal court in California.

OpenAI’s ChatGPT became the fastest-growing consumer application in history in the months following its launch in late 2022.

Musk’s xAI acquired X in March for US$33 billion to enhance its chatbot training capabilities. Musk has also integrated the Grok chatbot into vehicles made by his electric vehicle company, Tesla TSLA.O.