OpenAI has urged a U.S. federal court to dismiss a lawsuit filed by Elon Musk’s xAI, describing it as an attempt to harass the company and its leadership. The case, filed by Musk’s artificial intelligence startup, accuses OpenAI of poaching employees and misusing confidential information to gain a competitive edge in the AI race.

In its filing, OpenAI denied all allegations, asserting that xAI’s claims lack factual basis and are meant to create media noise rather than serve any legitimate legal purpose. The company argued that the lawsuit is part of what it termed Musk’s “ongoing campaign of harassment,” stemming from his public criticism and strained relationship with OpenAI’s current management.

OpenAI maintained that employee movement between tech firms is a common industry practice and that it does not restrict talent from joining or leaving any organization. “Our employees choose where they want to work — it’s a matter of professional freedom, not corporate coercion,” the company stated in its court submission.

Legal experts say the case reflects rising tensions between two of Silicon Valley’s most prominent AI players, both racing to dominate the fast-evolving market for generative AI systems. Musk’s xAI, which recently integrated its chatbot Grok into the X platform, has been positioning itself as a direct rival to OpenAI’s ChatGPT.

Observers suggest the dispute underscores broader competition in the AI industry, where issues like employee mobility, intellectual property, and data usage have become increasingly contentious.

The court’s decision on whether to allow the case to proceed could have major implications for hiring norms and confidentiality standards across the technology sector.