State Legal Leaders Seek SEC Probe of OpenAI’s Public Offering - Bloomberg Law News

Ten attorneys general—presumably with nothing better to do than read IPO filings—have formally asked the SEC to 'carefully vet' OpenAI's public offering. The reason? CEO Sam Altman's 'reported entanglements', which is lawyer-speak for 'we have no idea what he's actually up to, but it smells funny'. The letter, sent to SEC Chair Gary Gensler's successor, cites risks that could mislead investors if left unchecked. Because the company that's building AGI might have a little governance hiccup, no big deal.

The beauty is that the entanglements remain deliciously vague. Is Altman entangled with the non-profit board that controls the for-profit? With that side venture that makes brain chips? The AGs don't say, because they don't have to—the SEC can figure it out post-IPO, as is tradition. Meanwhile, OpenAI's PR machine will spin this as a 'welcome scrutiny' that demonstrates their commitment to transparency, right before they redact half the prospectus.

This is the same company that has already faced lawsuits over wrongful death and copyright infringement, and now can't even get through an IPO without a multi-state regulatory intervention. The irony is thick enough to spread on toast: a lab that warns about existential risk from AI can't manage the existential risk of its own founder's reported entanglements. If the SEC does its job, the IPO might be delayed. If it doesn't, well, investors can always join the class action later. Cheers to progress, but not too loudly—the AGs might hear you.