Meta has requested California Attorney General Rob Bonta to block OpenAI from changing its structure from a nonprofit to a for-profit organization.

The letter argues that OpenAI’s transition could set a precedent for technology startups.

It suggests that such a move may encourage other firms to operate as nonprofits for tax benefits and later convert to for-profit status to pursue commercial success.

Meta claims this could significantly impact the startup ecosystem in Silicon Valley.

OpenAI’s CEO Sam Altman asserts that converting to a for-profit model is necessary to attract additional investment and realize the company’s goals.

OpenAI faces an impending deadline to finalize this transition to secure the billions raised in 2024.

In response to Meta’s concerns, OpenAI board chair Bret Taylor reaffirmed the nonprofit board’s commitment to its mission of ensuring artificial general intelligence is beneficial to humanity.

Taylor said any restructuring would help the nonprofit arm flourish while maximizing the value derived from the for-profit segment.