X.AI Breaks Ground in Trade Secrets Suit

Elon Musk’s X.AI has filed the first trade secrets lawsuit alleging an employee stole generative AI code. It certainly won’t be the last.

The San Francisco-based company says AI architect Xuechen Li swiped its proprietary information, with the intent to take the company’s “entire code base” with him to a new job at competitor OpenAI. Li hasn’t responded to these allegations in court filings yet.

The fact pattern here isn’t new. Trade secrets cases often allege that employees bolted for a competitor with the crown jewels in tow.

But the rapidly advancing, lucrative technology — and resulting hyper-competitive scramble ...