Investors in artificial intelligence startup OpenAI, the company behind ChatGPT, are reportedly exploring legal options against the board after the removal of CEO Sam Altman triggered concerns of a mass employee exodus.
Investors, concerned about potential financial losses, are working with legal advisers to assess their options, Reuters reported.
The fear is that the mass employee exodus could jeopardize significant investments in OpenAI, a key asset in some portfolios, particularly as the generative AI sector grows rapidly.
Microsoft (NASDAQ:MSFT) owns 49% of the for-profit operating company, while other investors and employees control 49%, with 2% owned by OpenAI's nonprofit parent.
The board ousted Altman due to a "breakdown of communications," leading to a threat of resignations from over 700 employees unless the board is replaced. OpenAI's unique structure, controlled by its nonprofit parent, adds complexity to the situation.
Microsoft announced yesterday that it hired Altman and Greg Brockman, another co-founder of OpenAI, to lead their new advanced AI research unit.
Emmett Shear, the former CEO of Amazon (NASDAQ:AMZN)'s streaming service Twitch, has been appointed as the interim CEO of OpenAI. He takes over from Mira Murati, who had assumed the role of interim CEO following the removal of Sam Altman. Murati will return to her position as OpenAI's chief technology officer.