Last Week in AI #341 - Musk loses to OpenAI, Google's IO updates, OpenAI solves Erdős

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Elon Musk Loses $150 Billion Suit Against OpenAI and Sam Altman - The New York Times

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Source

A federal jury in Oakland, California unanimously rejected Elon Musk’s $150 billion lawsuit against OpenAI, Sam Altman, and Greg Brockman on May 18, 2026, after less than two hours of deliberation. The nine-member jury found that Musk’s claims of breach of charitable trust and unjust enrichment were barred by statutes of limitations of two and three years respectively, as Musk filed his suit in 2024 despite being aware of the alleged misconduct — OpenAI’s transition to a for-profit structure — as early as 2021. Presiding Judge Yvonne Gonzalez Rogers agreed, dismissing the case entirely.

Musk had accused Altman and Brockman of “stealing a charity” by attaching a commercial entity to OpenAI’s nonprofit foundation and accepting billions in investment from Microsoft, and had sought damages of up to $150 billion, the removal of Altman and Brockman, and the dismantling of the for-profit arm. The three-week trial featured testimony from over 20 witnesses including Microsoft CEO Satya Nadella and OpenAI co-founder Ilya Sutskever, and surfaced damaging revelations about Musk himself — including that he had OpenAI researchers, including Andrej Karpathy and Ilya Sutskever, work for free at Tesla without reimbursement, and that he had aggressively sought sole control of any OpenAI for-profit structure in 2017 before leaving the board in 2018.

The verdict clears the path for what could be one of the largest IPOs in history: just two days after the ruling, OpenAI confirmed it is preparing to confidentially file an IPO prospectus with the SEC, targeting a fall 2026 public debut. The company is working with Goldman Sachs and Morgan Stanley, is currently valued at $852 billion by private investors, and could reach a $1 trillion valuation at IPO. OpenAI reported $30 billion in annualized revenue as of April 2026 and has raised more than $180 billion from investors, though it continues to burn cash at a historic pace and has missed internal revenue and user-growth targets.

CEO Sam Altman reportedly hopes the company will be ready to list by September, though CFO Sarah Friar stressed the company would not go public until it is ready.

Google updates its Gemini app to take on ChatGPT and Claude at IO 2026

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Google debuts new AI models, personal AI agents in effort to keep pace with OpenAI and Anthropic

Google’s Gemini Omni turns images, audio, and text into video — and that’s just the start

Google launches Antigravity 2.0 with an updated desktop app and CLI tool at IO 2026

Google’s Genie world model can now simulate real streets with Street View

Google introduces Gemini Spark, a 24/7 agentic assistant with Gmail integration, at IO 2026

You can now talk to your Gmail inbox, as seen at Google IO 2026

Google’s new anything-to-anything AI model is wild

Google Search’s AI evolution includes more ads

The future of Google is a search box that does everything

Google just declared itself a contender in AI design at IO 2026

At Google I/O 2026, Google unveiled a sweeping set of AI updates across its product lineup aimed at competing with OpenAI and Anthropic. Here’s the highlights:

A rebuilt Gemini app with a new “Neural Expressive” design language featuring fluid animations and haptic feedback

Gemini 3.5 Flash, a lightweight frontier model that costs half to one-third the price of comparable models and is now the default model for the Gemini app and Search globally, while the heavier Gemini 3.5 Pro remains internal until next month.

Gemini Spark, a 24/7 cloud-based personal AI agent built on Gemini base models and the Antigravity agentic harness. Spark runs on dedicated virtual machines so it continues working when your phone is locked, integrates natively with Gmail, Google Docs, and Workspace via MCP, and lets users email it directly through a dedicated Gmail address.

Gemini Omni, a new family of models designed to take any input — images, video, audio, text — and generate video output grounded in real-world knowledge; the first release, Omni Flash, renders 10-second clips and is rolling out to the Gemini app, YouTube Shorts, and Google Flow, with an API coming in weeks and a more powerful Omni Pro to follow.

Gmail Live adds conversational AI to inbox search, allowing natural-language voice queries with follow-up questions.

Google Antigravity 2.0 debuts a desktop app, CLI, and SDK for orchestrating multi-agent coding workflows, with a new $100 AI Ultra plan (5x limits) and a price cut on the top tier from $250 to $200. Additional launches include

Pics, an AI design app for Workspace powered by Nano Banana 2 to compete with Canva and Claude Design, and

Street View integration with Genie 3, Google’s world model, which can now simulate real-world environments with weather and lighting changes for robotics training and consumer use, currently rolling out to Ultra subscribers in the U.S.

AI just solved an 80-year-old ‘Erdős problem,’ and mathematicians are amazed

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OpenAI claims it solved an 80-year-old math problem — for real this time

https://openai.com/index/model-disproves-discrete-geometry-conjecture/

Google Deepmind’s AlphaProof Nexus solves decades-old math problems for a few hundred dollars

OpenAI announced on May 20, 2026 that an internal general-purpose reasoning model disproved a central conjecture in the planar unit distance problem, one of combinatorial geometry’s most famous open questions first posed by Paul Erdős in 1946. For 80 years, the best known constructions for maximizing unit-distance pairs among n points were based on square grid arrangements, and it was conjectured it is not possible to do better than that. ChatGPT proved that it is. Fields Medalist Timothy Gowers called it “a milestone in AI-driven mathematics,” and mathematician Daniel Litt confirmed it would merit publication in a top math journal — something no prior AI proof had achieved.

Meanwhile, Google DeepMind released AlphaProof Nexus, a complementary framework that combines Gemini 3.1 Pro with Lean formal verification, where compiler error messages feed back into successive proof attempts. The system autonomously solved 9 out of 353 open Erdős problems, proved 44 out of 492 OEIS conjectures, and settled a 15-year-old question in algebraic geometry — all at inference costs of just a few hundred dollars per problem. Unlike OpenAI’s purely natural-language approach, AlphaProof Nexus grounds LLM reasoning with symbolic feedback, though a post-hoc analysis found that even its simplest agent (just LLM + compiler loop) could solve all nine Erdős problems.

Both efforts collectively signal a new phase in AI-assisted mathematics, though Terence Tao cautioned that AI’s overall success rate on Erdős problems remains around 1–2%, concentrated on easier tasks, and experts note that genuinely new groundbreaking mathematical theory remains beyond current models. Human mathematicians also flagged concerns about AI failing to credit prior literature — what Melanie Wood called potential “professional malpractice” — as a cultural norm the community urgently needs to address.

America’s dangerous, messy deepfakes crackdown is here

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Google is trying to make deepfake detection more accessible for everyone

OpenAI is making it easier to check if an image was made by their models

Source

The Take It Down Act, signed by President Trump last May and fully in force as of May 19th, 2026, requires online platforms to remove nonconsensual intimate imagery (NCII) — including AI-generated sexual deepfakes — within 48 hours or face civil penalties exceeding $53,000 per violation. The FTC, tasked with enforcement, sent letters to over a dozen major platforms including Meta, Google, Amazon, TikTok, X, Snapchat, and Microsoft, requiring them to offer easy takedown request processes and remove “known identical copies.” Major platforms have expressed support and claimed compliance, with Meta citing existing anti-NCII tools and TikTok pointing to partnerships with NCMEC and StopNCII.org. In its first year, the law’s criminal provision was used in just one conviction — an Ohio man who produced AI deepfakes to harass victims.

Despite broad platform support, experts are raising serious concerns. The Electronic Frontier Foundation, the Cato Institute, and Public Knowledge warn the takedown provision could enable censorship and over-moderation. Mary Anne Franks of the Cyber Civil Rights Initiative fears the law will be a “paper tiger” against major offenders while being weaponized against disfavored platforms, noting Trump’s own State of the Union quip that he’d use the bill “for myself.” The law also has technical gaps — it’s unclear whether AI tools like Grok qualify as “creators” of NCII or whether privately generated images fall under the takedown provision.

On the detection front, Google is expanding SynthID watermark verification to Chrome and Search via Gemini, and adding support for C2PA content credentials, while OpenAI is adopting both C2PA metadata and SynthID watermarking for its image generators.

SpaceX Is Said to Plan to Buy Startup Cursor 30 Days After IPO - Bloomberg

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Musk’s SpaceX Reveals Its Finances for the First Time

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Elon, stop trying to make Grok happen

Heavy losses and weak revenue: xAI’s brutal numbers

Musk’s xAI Warns Staffers to Limit Contact With Cursor Employees

xAI introduces its coding agent called Grok Build

SpaceX filed its S-1 IPO prospectus on May 20, 2026, targeting a $1.75–$2 trillion valuation and seeking to raise $75 billion on the Nasdaq under ticker SPCX. The filing reveals 2025 revenue of $18.7 billion (up 33% YoY) but a net loss of $4.9 billion, with Q1 2026 showing $4.7 billion in revenue alongside $4.3 billion in net losses. The losses are in significant part due to the capital expenditures associated with the construction of xAI’s data centers (xAI is now part of SpaceX).

According to “people familiar with the matter”, SpaceX also plans to acquire AI coding startup Cursor for $60 billion approximately 30 days after the IPO. SpaceX and Cursor already confirmed having made a deal last month that would give SpaceX the right to do this aquisition, but this is the first reporting suggested that SpaceX is planning to go through with it.

This acquisition appears driven by the poor performance of xAI’s own products: Grok has roughly $270 million in annualized subscription revenue versus OpenAI’s $24 billion and Anthropic’s $30 billion, appeared in only 3 of 400+ government AI use cases reviewed by Reuters, and xAI posted a $6.4 billion operating loss in 2025. The internal situation is also dire: all 11 original xAI co-founders have departed, 50+ researchers and engineers have left for Meta and Thinking Machines Lab, the pre-training team has shrunk to a handful of people, and Musk ordered layoffs in March after Grok lagged behind Claude Code and OpenAI Codex — even as SpaceX launched a competing coding agent, Grok Build, now in early beta at $300/month.

Additional controversies include xAI’s Memphis data center operating 46 unregulated gas turbines despite permits for only 15, facing an NAACP lawsuit, while SpaceX’s IPO filing reveals plans to spend another $2.8 billion on turbines over three years.

Pope Leo Uses First Major Papal Text to Warn About Dangers of AI

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