Elon Musk, the ever-controversial billionaire entrepreneur, has once again thrown himself into the center of Silicon Valley’s most heated rivalry. On August 25, 2025, Musk’s artificial intelligence startup xAI, along with its social media business X (formerly Twitter), filed a sweeping lawsuit in the U.S. District Court for the Northern District of Texas, targeting two of the biggest names in tech: Apple and OpenAI. The case accuses the pair of orchestrating an “anticompetitive scheme” designed to suppress rivals in the rapidly evolving world of artificial intelligence.
According to the complaint, Apple and OpenAI have “locked up markets to maintain their monopolies and prevent innovators like X and xAI from competing.” At the core of Musk’s argument is Apple’s exclusive integration of OpenAI’s ChatGPT into its operating systems—a move announced in June 2024 at Apple’s developers conference. This partnership, Musk alleges, has made ChatGPT the only generative AI chatbot natively available on iPhones, iPads, and Macs. As a result, consumers are, in Musk’s words, “locked into using ChatGPT,” with no practical access to alternatives like xAI’s Grok chatbot.
The lawsuit goes further, claiming that Apple has manipulated its App Store rankings to deprioritize competing chatbots such as Grok, giving preferential treatment to OpenAI’s product. “If not for its exclusive deal with OpenAI, Apple would have no reason to refrain from more prominently featuring the X app and the Grok app in its App Store,” xAI asserts in the legal filing. Apple, for its part, holds a commanding 65 percent of the U.S. smartphone market—a position that, Musk argues, gives it outsized influence over which AI products reach the public.
Apple and OpenAI did not immediately respond to requests for comment, but both have previously rejected claims of bias. An Apple spokesperson told the BBC, “We feature thousands of apps through charts, algorithmic recommendations and curated lists selected by experts using objective criteria.” OpenAI, meanwhile, described the lawsuit as “consistent with Mr. Musk’s ongoing pattern of harassment.”
For Musk, the legal battle is personal as well as professional. He co-founded OpenAI with Sam Altman in 2015, only to leave in 2018 over disagreements about the company’s direction. Since then, his relationship with OpenAI and Altman has soured dramatically. Musk’s xAI, launched less than two years ago, has positioned itself as a direct competitor to OpenAI, Microsoft-backed AI ventures, and Chinese upstart DeepSeek. In March 2025, xAI acquired X in an all-stock transaction valued at $33 billion, aiming to enhance its chatbot training capabilities. Not one to miss a synergy, Musk has also integrated Grok into Tesla vehicles, bringing his AI ambitions to the automotive world.
But the Apple-OpenAI partnership is the flashpoint. In Musk’s view, the deal allows OpenAI to “pull further ahead in the race to build artificial intelligence,” giving it access to “billions of user prompts” from iPhone owners—data that is invaluable for training and improving AI models. “In a desperate bid to protect its smartphone monopoly, Apple has joined forces with the company that most benefits from inhibiting competition and innovation in AI: OpenAI, a monopolist in the market for generative AI chatbots,” the lawsuit contends.
The stakes are high, not just for the companies involved but for the entire AI industry. Apple’s move to integrate ChatGPT comes as it tries to catch up in the mobile AI race. While Google has already embedded its Gemini assistant into Samsung and Pixel smartphones, Apple’s own AI, dubbed Apple Intelligence, has been delayed until 2026. In the meantime, using ChatGPT with Siri is the main AI upgrade available to Apple users.
The lawsuit is the latest episode in an ongoing feud between Musk and Altman. In 2024, Musk sued OpenAI and Altman in federal court in California, alleging that the company’s shift from nonprofit to for-profit status violated its founding mission to develop AI “for the benefit of humanity broadly.” In a counterclaim, OpenAI accused Musk and xAI of “harassment” through litigation, social media attacks, and even a “sham bid” to buy OpenAI for $97.4 billion—a move OpenAI claims was designed to harm its business relationships. Altman, never one to shy away from a public spat, told Bloomberg in February that Musk’s lawsuits are “a tactic to slow down OpenAI’s innovation” and perhaps stem from “a place of insecurity over xAI.”
The legal drama has spilled over into social media, where both sides have traded barbs. After Musk threatened to sue Apple earlier in August, Altman responded on X, “This is a remarkable claim given what I have heard alleged that Elon does to manipulate X to benefit himself and his own companies and harm his competitors and people he doesn’t like.” Community Notes on X pointed out that, despite Musk’s claims, rival chatbot apps like DeepSeek and Perplexity have at times ranked number one on the App Store since the Apple-OpenAI partnership was announced. As of August 25, 2025, ChatGPT was still the number one free app, with Grok at number 26 and X at 31.
The broader context is one of increasing scrutiny on Apple’s App Store practices. The company has faced multiple lawsuits, including a high-profile case brought by Epic Games, the maker of Fortnite, which resulted in a judge ordering Apple to allow greater competition in app payment options. Apple maintains that its App Store is “fair and free of bias,” but critics—including Musk—argue that its control over app rankings and access gives it the power to shape entire markets.
Musk’s decision to file the lawsuit in Texas is no accident. After a Delaware judge voided his Tesla pay package in 2024, Musk began shifting several of his companies’ headquarters to Texas to avoid Delaware jurisdiction. He also updated X’s terms of service to require users to bring any legal disputes in Texas court, a move that could give him a home-court advantage in future legal battles.
Despite the legal fireworks, Wall Street has barely blinked. On the day the lawsuit was filed, Apple’s stock ticked up 0.6 percent, and Tesla’s was up 1.2 percent as of noon in New York. OpenAI and xAI remain private companies, so their valuations are less immediately affected by the court drama.
For iPhone users, the lawsuit is unlikely to change the experience of using Siri or ChatGPT anytime soon. The legal process will take months—if not years—to play out, and the filing requests a jury trial. But the outcome could have far-reaching implications for how AI products are distributed, how data is shared, and who controls the future of artificial intelligence.
As the dust settles, one thing is clear: the battle lines in the AI wars are drawn, and neither side seems willing to back down.
