Elon Musk’s xAI Hit With Lawsuit From Ethereum Gaming Company

Elon Musk's artificial intelligence venture xAI faces legal fire from an unexpected quarter—Ethereum's gaming sector just dropped a lawsuit bomb.

The Allegations

Court documents reveal claims of intellectual property infringement and alleged misuse of proprietary gaming algorithms. The Ethereum-based firm argues xAI's systems incorporated their patented technology without authorization—adding fuel to the ongoing AI ethics debate.

Market Reactions

While Musk's ventures typically send crypto prices soaring, this litigation creates uncertainty. Traders watch closely—another reminder that in crypto, even billionaires can't bypass legal scrutiny. Sometimes the most sophisticated AI still can't code its way out of a lawsuit.

Final thought: When gaming meets AI litigation, everyone loses—except the lawyers collecting those billable hours in ETH.

Confusion grew after Musk entered gaming

The dispute began when Musk launched his xAI company in July 2023. The confusion grew in November 2024 after Musk said his company WOULD start a gaming studio called xAI. According to the filing, this led consumers, media outlets, and even Musk’s chatbot Grok to mistakenly connect his company with the Xai gaming network.

Ex Populus argues that the damage goes beyond brand confusion. The company says being linked to Musk has brought negative public sentiment because of the controversies tied to his projects. It claims this unwanted association is undermining the goodwill and reputation it has worked to build.

The filing also accuses Musk’s legal team of trying to pressure Ex Populus earlier this month into giving up its trademark rights by threatening to challenge its registration. It further notes that the US Patent and Trademark Office has already suspended several of Musk’s xAI trademark applications due to their similarity to Xai’s mark.

Ex Populus is asking the court to cancel Musk’s pending applications, block his company from using the name in gaming and blockchain, and award damages. The company says the harm caused is so severe that no simple legal remedy can fix it.

Also Read: OpenAI’s CEO Sam Altman Fires Back at Elon Musk’s Apple Lawsuit Threat