OpenAI CEO declares „code red” because of Google. Billion-dollar compensation payout is looming over the company

Sam Altman from OpenAI reportedly declared a "code red" because their competitors' AI models are getting better and better. Google is becoming a major competitor with their Gemini 3.0 model, which launched in November this year. At the same time, it seems that OpenAI is losing in court, and there are suspicions of attempts to hide legal violations.

OpenAI may lose on two fronts

The Wall Street Journal editorial team obtained a message sent to OpenAI employees by Sam Altman. Its content says the company boss called a "code red" because of what the competition's been up to lately. In November, Google (Gemini 3.0) and Anthropic (Claude Opus 4.5) released their new models. Sam Altman expects ChatGPT to be improved in virtually every aspect: speed, reliability, and personality.

That last part seems super important because ChatGPT is supposed to be more straightforward and tailor its "personality" to fit the user better. Another issue is that OpenAI has put in too many security measures. The chatbot often refuses to answer certain topics, unlike other models, which is causing users to leave.

The transformation of the chatbot is not the only challenge OpenAI is facing. Right now, the company is caught up in a legal fight over a class-action lawsuit from authors linked to the Authors Guild. A leaked conversation between two company employees suggested that two datasets, Book1 and Book2, which contained pirated copies of books used to train the model, had been removed.

OpenAI wasn't too keen on sharing details about their datasets. At first, they cited attorney-client privilege, then said they'd reveal some info, but later backed out of that promise. In the end, OpenAI's lawyers said they got rid of the datasets because they weren't being used, and the details are kept under wraps as a trade secret. However, Judge Ona Wang disagrees and has ordered the disclosure of the evidence. If the court decides the company purposely got rid of important evidence to cover up a crime, they could be hit with massive fines running into billions of dollars.

The corporation had to juggle two big challenges: keeping up with the competition that's always on the move and dealing with legal battles where OpenAI might get into trouble for breaking copyright laws.

• tech
• AI / Artificial Intelligence
• OpenAI
• chatbots / ChatGPT