Elon Musk’s X and xAI Sue Apple and OpenAI Over ChatGPT iPhone Deal

Elon Musk’s X and xAI Sue Apple and OpenAI Over ChatGPT iPhone Deal

Apple’s high-profile partnership with OpenAI just landed the company in serious legal trouble. On August 25, 2025, Elon Musk’s X Corp. and xAI filed a sweeping antitrust lawsuit in the U.S. District Court for the Northern District of Texas, accusing Apple and OpenAI of creating an illegal monopoly around ChatGPT’s exclusive integration into the iPhone.

What the Lawsuit Claims

At the heart of the case is Apple’s decision to make ChatGPT the only generative AI deeply integrated into iOS. According to the filing:

  • This move allegedly blocks rival AIs like xAI’s Grok, Google’s Gemini, and Anthropic’s Claude from gaining scale through iPhone users.

  • Siri, Writing Tools, and other Apple features funnel prompts exclusively into ChatGPT, giving it billions of real-world inputs.

  • By denying other AIs that exposure, Apple is allegedly foreclosing competition and strengthening its smartphone monopoly.

The lawsuit also says Apple manipulates App Store rankings by deprioritizing rivals like Grok and X’s apps while prominently featuring ChatGPT in editorial “Must-Have Apps” lists.

Bigger Picture: Protecting the iPhone Ecosystem

The complaint frames Apple’s strategy as defensive:

  • Apple fears “super apps”—like Grok integrated into X—could reduce consumer dependence on iOS.

  • Internal comments from Apple SVP Eddy Cue reportedly show concern that AI could disrupt Apple “just like the iPhone disrupted Nokia.”

  • The plaintiffs argue Apple is walling off its ecosystem to ensure iPhone users only rely on Apple’s chosen AI partner.

Who Else Was Shut Out?

The lawsuit highlights how other players were left in the cold:

  • Google’s Gemini: Negotiations reportedly collapsed after Apple committed to OpenAI.

  • Anthropic’s Claude: Never had a chance to compete for OS-level access.

This follows testimony from Google’s CEO earlier this year, confirming Apple declined its AI integration proposal.

What Musk’s Companies Want

The lawsuit seeks:

  • Billions in damages for lost business opportunities.

  • A permanent injunction blocking Apple from giving OpenAI exclusive access.

  • A jury trial to decide the case.

Musk had already threatened legal action earlier this month, calling Apple’s deal with OpenAI an “unequivocal antitrust violation.”

Apple’s Response So Far

Apple hasn’t formally commented on the lawsuit. But when Musk first made threats, Apple defended the App Store, saying:

“We feature thousands of apps through charts, algorithmic recommendations and curated lists selected by experts using objective criteria. Our goal is to offer safe discovery for users and valuable opportunities for developers.”

Why This Matters

This case is about more than just Siri and ChatGPT—it could reshape how AI ecosystems are integrated into smartphones. If X Corp. and xAI succeed, Apple may be forced to open iOS to multiple AI providers, changing the way billions of people interact with their devices.

At the same time, the lawsuit tests the limits of antitrust law in the AI era, raising questions about whether OS-level AI integrations should be treated like app store gatekeeping.

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