Billionaires Brawl, Courts Intrude—And Everyone Else Pays
Good Morning from San Francisco, The world's most expensive friendship just imploded 💥. Trump and Musk torched their alliance
Good Morning from San Francisco,
The world's most expensive friendship just imploded 💥. Trump and Musk torched their alliance over electric vehicle subsidies, wiping $150 billion off Tesla in three hours 📉. Musk threatened to strand astronauts 🚀. Trump threatened to cancel SpaceX contracts 🔥. Both men forgot they're not running reality TV shows 📺.
Meanwhile, OpenAI fights a court order forcing it to hoard every ChatGPT conversation forever 🗂️. The New York Times wants proof that ChatGPT steals articles 📰. Users want their deleted chats to stay deleted 🗑️. Privacy advocates are furious 😤.
When billionaires brawl and courts meddle, the rest of us pay the price 💸.
Stay curious,
Marcus Schuler
The most expensive friendship in American politics collapsed in spectacular fashion Thursday. Elon Musk and Donald Trump spent the day attacking each other across social media platforms, turning a budget disagreement into a personal war that wiped $150 billion off Tesla's value in three hours.
The speed shocked everyone. Last week, Trump gave Musk a ceremonial White House key and called him "one of the greatest business leaders the world has ever produced." By Thursday, Musk was accusing Trump of hiding Jeffrey Epstein files while Trump threatened to cancel billions in government contracts.
Their fight started over Trump's budget bill, which cuts electric vehicle subsidies that benefit Tesla. Musk had spent $250 million backing Trump's campaign, expecting favorable treatment. Instead, he watched his influence disappear as fast as Tesla's stock price.
The real damage came from personnel fights behind the scenes. Trump pulled his nomination of Jared Isaacman, Musk's pick for NASA administrator. White House officials had already started limiting Musk's authority over staffing and budget decisions.
Musk escalated by threatening to decommission SpaceX's Dragon spacecraft, currently the only American vehicle that can ferry astronauts to the International Space Station. Seven people are aboard right now, including three NASA astronauts.
Tesla shares plunged 14% in a single session. Musk personally lost $20 billion on paper. The selloff reflected deeper concerns about Tesla's robotaxi plans, which depend on regulatory approval Trump could now delay.
The breakup played out like reality TV across their separate platforms. Neither directly replied to the other. Observers had to toggle between Truth Social and X to follow their escalating attacks.
Why this matters:
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Prompt:
A high-resolution front-facing photo of three or four ripe pink peaches falling into clear pink water with no air bubbles. The scene is captured just as the peaches are entering or partially submerged in the water, with soft ripples and subtle light refractions around them. The water is transparent and calm, with a warm white-beige tint, illuminated by soft natural light. No visible air bubbles, and the peaches are spaced naturally apart without overlapping. The atmosphere is gentle and serene, with a minimalistic and warm tone.
OpenAI is appealing a federal court order that forces it to save every ChatGPT conversation and API response forever. The company argues the May ruling violates user privacy and sets a dangerous precedent.
The dispute started when The New York Times sued OpenAI for copyright infringement. The newspaper claims ChatGPT reproduces Times articles without permission. To prove their case, Times lawyers asked the court to preserve all ChatGPT output data.
Magistrate Judge Ona Wang agreed. Her May 13th order requires OpenAI to "preserve and segregate all output log data" going forward. This overrides OpenAI's standard practice of deleting user conversations after 30 days.
The company filed its appeal on June 3rd, calling the preservation order "sweeping" and "unprecedented." OpenAI argues it forces them to break privacy promises made to hundreds of millions of users.
CEO Sam Altman posted on X that the company will "fight any demand that compromises our users' privacy." He called the Times' request inappropriate and said it sets a bad precedent.
The order affects most ChatGPT users. Free, Plus, Pro, and Team subscribers can no longer truly delete their conversations. API customers without special zero-retention agreements also lose their privacy protections.
Enterprise and Education customers avoid the data preservation requirement. So do API users who specifically contracted for zero data retention.
OpenAI says the preserved data sits in a separate secure system. Only a small legal team can access it for legal purposes. The data won't automatically go to The Times or other plaintiffs.
Why this matters:
• Users often share sensitive personal and business information with ChatGPT, assuming it will disappear when deleted
• This case could push AI companies to relocate to countries with stronger privacy protections
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Two former Palantir executives raised $20 million for Thread AI, their infrastructure startup that helps companies build AI workflows without the usual headaches of rigid software or expensive custom builds. Angela McNeal and Mayada Gonimah founded the company after experiencing firsthand how security clearances and complex enterprise systems can create communication gaps between builders and users.
AMD acquired the engineering team behind Untether AI, marking its third acquisition in eight days as the chip maker builds AI capabilities to challenge Nvidia. The Toronto startup shut down operations and stopped supporting its energy-efficient AI chips, with most employees joining AMD last month.
Manus raised $75 million in a funding round led by Benchmark, reaching a $500 million valuation after sparking weeks of social media frenzy for invite codes when it launched in March. The Wuhan-based startup Butterfly Effect saw 2.6 million users join its waiting list within weeks, with invite codes reportedly selling for thousands of dollars on Chinese reseller apps.
Runway CEO Cris Valenzuela pitched Hollywood studios on AI video generation during a live interview, claiming his company creates "net-new" content while carefully avoiding direct questions about training on YouTube videos. The AI video startup just raised $308 million at a $3 billion valuation, but faces lawsuits over allegedly using copyrighted material to train its models.
Anthropic cut Windsurf's access to Claude AI models after reports that OpenAI plans to acquire the coding tool for $3 billion. Company co-founder Jared Kaplan said it would be "odd" to sell Claude to OpenAI, forcing Windsurf users to find alternative AI coding assistants or pay for their own API keys.
Defense startup Anduril Industries raised $2.5 billion in fresh funding, pushing its valuation to $30.5 billion. That's more than double what the company was worth just eight months ago.
Peter Thiel's Founders Fund led the round with a $1 billion check. The firm's biggest investment ever. Anduril chairman Trae Stephens, who also works at Founders Fund, announced the deal at Bloomberg's tech conference Thursday.
The company makes weaponized drones, surveillance towers, and augmented reality gear for the military. Founded in 2017 by Palmer Luckey after his messy exit from Facebook, Anduril wants to shake up a defense industry dominated by old-school contractors like Lockheed Martin.
The new money will fund Anduril's manufacturing push. The company is building Arsenal-1, a massive factory in Columbus, Ohio that will pump out tens of thousands of defense systems annually. What started as a several-hundred-million-dollar project now costs over $1 billion and will create 4,000 jobs.
Anduril plans a second factory too. The Ohio site has 500 acres of expansion room.
Recent wins include taking over Microsoft's Army headset program and partnering with Meta on military AR devices. That Meta deal could land a $22 billion Army contract. Anduril's surveillance systems already cover up to half the US border.
The funding comes as defense tech heats up. Ukraine's drone warfare against Russia shows how new technology reshapes modern conflict. China's military buildup adds pressure for the US to accelerate drone development.
Anduril benefits from strong ties to the Trump administration. Stephens consulted on defense transformation after the election. Another company executive, Michael Obadal, got nominated as the Army's number two civilian official.
The round was oversubscribed. Investors wanted to put in eight to ten times more money than Anduril accepted. The company also ran a tender offer, letting early employees and investors cash out hundreds of millions in shares.
Why this matters:
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