Elon Musk and Sam Altman, CEO of OpenAI, are scheduled to go head-to-head in a U.S. federal court in California on Tuesday regarding Musk's lawsuit aimed at stopping OpenAI's transition from a nonprofit to a for-profit organization.

Musk, who co-founded OpenAI alongside Altman in 2015 but later left, contends that the organization has deviated from its original goal of creating AI for the benefit of humanity.

He claims it is now primarily focused on generating profits.

In its defense, OpenAI plans to refute Musk's allegations and has suggested that he should enter the competitive AI market instead of pursuing legal action.

The hearing will consider Musk's petition for an injunction to block the transition, which OpenAI asserts is essential to obtain the funding necessary for advancing AI development.

The change in OpenAI's structure is linked to several major funding rounds, including a recent $6.6 billion investment and prospective discussions for future funding with SoftBank, dependent on the company's reorganization.

Analysts highlight that conversions from nonprofit to for-profit status are uncommon, usually occurring in industries like healthcare rather than within technology startups.