OpenAI seeks $1 million fees from xAI after dismissal

OpenAI has asked a federal court to order Elon Musk's artificial intelligence company, xAI, to pay more than $1 million in legal fees, arguing that a trade secrets lawsuit filed by xAI should never have been brought. The motion, filed on Monday, July 13, 2026, came hours after xAI notified the court it would appeal the dismissal of its case. This legal maneuver unfolds as OpenAI faces a new and similar lawsuit from Apple Inc., filed on Friday, July 10, 2026, which accuses the AI firm of stealing hardware trade secrets.

The dispute between OpenAI and xAI began in September 2025 when xAI sued its rival in the U.S. District Court for the Northern District of California. xAI alleged that OpenAI had poached its engineers, including a former employee named Xuechen Li, and encouraged them to bring confidential information with them. In February 2026, Judge Rita Lin granted OpenAI's motion to dismiss the complaint but allowed xAI to amend its filing. xAI submitted an amended complaint in March, adding allegations that OpenAI encouraged a new hire to discuss work from his previous employer.

On June 15, 2026, Judge Lin dismissed the case a second time, this time "with prejudice," meaning...