xAI filed its opening appellate brief with the US Court of Appeals for the Ninth Circuit on 24 August, asking the court to revive a trade secrets lawsuit a district judge dismissed on 15 June. The original complaint accused OpenAI of running a coordinated campaign to poach xAI engineers and, through them, acquire xAI’s trade secrets. The district court dismissed the case without leave to amend, which is why an appeal rather than a rewritten complaint is xAI’s only path forward.
The brief argues the lower court misapplied the Defend Trade Secrets Act and improperly discounted corroborating allegations from former xAI employees. Elon Musk’s company put the stakes in broad terms, telling the appeals court that the district court’s reasoning sets an impossibly high bar for pleading trade secret claims and hands bad actors a roadmap for evading liability. OpenAI has until 23 September to file its response brief.
The case sits inside a wider pattern of litigation between Musk’s ventures and OpenAI, the company he co-founded and later split from acrimoniously, and it arrives as both labs compete for the engineers and compute that determine who leads the next round of models. A revived case would put OpenAI back into discovery over its hiring practices, the kind of process that tends to surface internal communications neither side wants public.
The brief includes no new factual detail, no specific trade secret, no named engineer, no dollar figure attached to the alleged harm. That was largely true of the original complaint too, and it was the thinness of the allegations, not just their legal framing, that got the case thrown out. Whether an appellate panel finds the argument more persuasive than the district court did is now a matter of months.
