Shivon Zilis Testifies on Tesla-OpenAI Proposal in Musk Trial

Benzinga reported Wednesday that Shivon Zilis, a board member at OpenAI and partner of Tesla CEO Elon Musk, took the stand in a high-stakes San Francisco courtroom. Her testimony shed new light on the Tesla OpenAI proposal that Musk once advanced and the early tensions that preceded his exit from the AI company’s board.

Musk Proposed OpenAI Become a Tesla Unit

Zilis told the court that multiple structural options for OpenAI were floated internally during its formative years. Among them was Musk’s suggestion that OpenAI operate as a subsidiary of Tesla. The three OpenAI cofounders, Ilya Sutskever, Sam Altman, and Greg Brockman, rejected the idea outright. Zilis also noted that Musk voiced concerns about talent competition between Tesla and OpenAI around the time he left its board in 2018. He had recruited a prominent AI researcher from OpenAI to Tesla just days before departing.

Also Read: OpenAI Transition to For-Profit Structure Faces Regulatory Scrutiny

How Zilis Became Central to the Case

Zilis first encountered Musk through OpenAI back in 2016. She later took on advisory and board roles while simultaneously working across several of Musk’s companies. Opposing counsel at the trial characterized her as a key conduit between Musk and OpenAI’s inner workings. Both Zilis and Musk’s legal team pushed back on that framing, insisting she operated independently throughout.

Lawyers for OpenAI pressed her on whether she channeled confidential information to Musk during her board tenure. She maintained her primary allegiance was to the broader goal of beneficial AI development.

Background: A Lawsuit Years in the Making

Musk left OpenAI’s board in 2018 after disputes over control and direction. He filed suit against the organization earlier this year, seeking roughly $134 billion in damages. His complaint calls for leadership changes and a return to OpenAI’s original nonprofit structure. OpenAI has characterized the action as a campaign of harassment driven by Musk’s frustration at losing influence over the company he helped found.

Wedbush Expects Bruises, Not a Knockout

Wedbush analyst Dan Ives called the proceedings a courtroom “soap opera,” warning the increasingly personal exchanges risk dragging out the dispute well beyond its natural endpoint. The liability phase of the trial is expected to run through mid-May, with a potential remedies phase to follow. Despite the acrimony, Ives told clients the likely outcome amounts to limited reputational damage on both sides. He does not expect the case to threaten OpenAI’s operations or Altman’s position leading the company.

Read Next: AI Regulation Debate Heats Up as Senate Weighs Landmark Tech Bill