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submitted 11 months ago by throws_lemy@lemmy.nz to c/technology@lemmy.world
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[-] chaorace@lemmy.sdf.org 4 points 11 months ago* (last edited 11 months ago)

It could probably be argued that the board didn’t do what was best for the investors, which is what they exist to do.

Incorrect. OpenAI LLC (the traded company) does not have a board of directors. The board of directors actually belong to the parent company, simply "OpenAI", which is a nonprofit organization -- the only thing that they're beholden to is the OpenAI company charter.

Here's a simplified breakdown:

Board of Directors =[controls]=> OpenAI (non-profit) =[controls]=> OpenAI LLC =[employs]=> OpenAI CEO

OpenAI LLC is obligated to act in the best financial interest of their shareholders, but OpenAI LLC does not actually have control over who sits in the CEO chair. That power goes to the non-profit "OpenAI" parent company -- a company beholden to their board, not shareholders.

[-] Cavemanfreak@lemm.ee 2 points 11 months ago

Aah! That's more than I knew. Thanks for the lesson! Then it definitely makes sense that they wouldn't have a case.

this post was submitted on 21 Nov 2023
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