Elon Musk‘s artificial intelligence company xAI has filed a major federal lawsuit against tech giants Apple and OpenAI. The 61-page complaint was submitted to a Texas court on Monday, August 25, 2025. Both xAI and Musk’s social media platform X are listed as plaintiffs in the case.
The lawsuit accuses Apple and OpenAI of working together to stop competition in the AI market. According to the Reuters, the two companies have created an unfair partnership that hurts other AI companies. The legal action claims Apple controls 65% of the US smartphone market while OpenAI holds at least 80% of the AI chatbot market through ChatGPT.
xAI is seeking billions of dollars in damages from the lawsuit. The company argues that Apple’s partnership with OpenAI makes it nearly impossible for competing AI apps to succeed on the App Store. “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,” the lawsuit states.
Legal experts weigh in on antitrust claims
Legal experts who study antitrust law have mixed views on the case. Some believe Apple’s large share of the smartphone market could help xAI’s argument that the company is breaking competition rules. The experts say Apple might defend itself by claiming the OpenAI partnership was simply a business choice in a competitive market.
Apple is behaving in a manner that makes it impossible for any AI company besides OpenAI to reach #1 in the App Store, which is an unequivocal antitrust violation.
— Elon Musk (@elonmusk) August 12, 2025
xAI will take immediate legal action.
Herbert Hovenkamp, who teaches law at the University of Pennsylvania, suggests Apple could argue there are security or practical reasons for adding AI to its operating system. Christine Bartholomew, a law professor at the University at Buffalo, calls the case “a canary in the coal mine” for how courts will handle AI antitrust issues in the future.
The lawsuit comes after weeks of public arguments between Musk and OpenAI CEO Sam Altman. Earlier this month, Musk threatened to sue Apple over what he called unfair treatment of his AI app Grok in the App Store rankings. Altman fired back, suggesting Musk manipulates his own platform to help his companies and hurt competitors. Musk called Altman a “liar” in response.
Background of the ongoing feud
The legal battle has deep roots in Musk’s history with OpenAI. Musk helped start OpenAI alongside Altman back in 2015, but left the company in 2018 due to disagreements about its direction. Since then, the relationship between the two men has become increasingly hostile.
Musk launched xAI in 2023 as a direct competitor to OpenAI and other major AI companies. His company acquired the social media platform X in March 2025 in an all-stock deal. Meanwhile, Apple announced its partnership with OpenAI in June 2024, integrating ChatGPT into iPhones, iPads, and Mac computers. This deal has become the focus of Musk’s latest legal challenge. The tech billionaire runs several major companies, including Tesla, SpaceX, and Neuralink.
The lawsuit also points to Apple’s App Store practices as evidence of unfair treatment. According to the complaint, xAI’s apps have never appeared in Apple’s “Must-Have Apps” section, while ChatGPT is featured prominently. However, Apple has defended its App Store as “fair and free of bias,” saying it features thousands of apps using expert recommendations and objective criteria. Some observers note that other AI apps, including DeepSeek and Perplexity, have reached the top of the App Store charts since the Apple-OpenAI partnership began, which could weaken xAI’s claims of systematic bias.
