xAI sues an ex-employee for allegedly stealing trade secrets about Grok

xAI doesn’t want its secret recipe for Grok to get out, and it’s filing a lawsuit to make sure of that. In a lawsuit filed earlier this week, xAI claimed that former employee Xuechen Li stole the company’s confidential info and trade secrets before joining the team at OpenAI.

Elon Musk’s artificial intelligence company also alleged that Li copied documents from an xAI company laptop to at least one of his personal devices. According to the suit, Li stole “cutting-edge AI technologies with features superior to those offered by ChatGPT and other competing products. This confidential info could result in a potential edge for rival companies in the AI market and “could save OpenAI and other competitors billions in R&D dollars and years of engineering effort,” xAI said in the lawsuit. The company behind Grok accused Li of taking “extensive measures to conceal his misconduct,” including renaming files, compressing files before uploading them to his personal devices and deleting browser history.

The lawsuit added that Li asked xAI to buy back company shares that were given as part of his compensation package, totaling approximately $7 million, before leaving the company to join OpenAI. xAI is asking the courts to file a temporary restraining order that forces its former employee to give up access to any personal devices or online storage services and return any confidential material to the company. On top of that, xAI wants to temporarily block Li from working at OpenAI or any other competitor until the company has recovered all of its trade secrets.

xAI’s lawsuit comes amidst a major talent war between leading AI companies looking for top researchers. These AI researchers are highly sought after, with competitors offering up to $250 million pay packages in attempts to poach them from their current companies. Beyond the AI talent war, Musk and xAI recently sued OpenAI and Apple, claiming the two companies are working together to maintain a monopoly on the AI market.