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OpenAI denies that it’s weighing a ‘last-ditch’ California exit amid regulatory pressure over its restructuring
OpenAI executives are discussing a potential relocation out of California as increasing political resistance threatens the company's efforts to convert from nonprofit to for-profit status, according to The WSJ, but the company says it has no plans to leave.
California’s attorney general is investigating whether OpenAI’s restructuring violates state charitable trust law, while a coalition of nonprofits, labor groups, philanthropies, and even rival Meta are pushing back against the conversion. OpenAI has about $19 billion in funding tied to this restructuring – if it doesn’t happen, investors could walk away, which would be catastrophic for the ChatGPT maker. The company continues working with state and Delaware attorneys general on the restructuring process; in the meantime, the regulatory pressure adds to OpenAI’s existing challenges, including competing in an escalating AI talent war.
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