Legal Challenge Over AI Compute Control
Eleven ChatGPT Plus subscribers have filed a class action lawsuit against Microsoft, alleging the tech giant deliberately restricted OpenAI’s access to computational resources through an exclusive cloud agreement. The complaint, filed in San Francisco federal court, claims Microsoft used its Azure cloud dominance to artificially inflate AI subscription prices while developing its own competing products.
The lawsuit describes Microsoft’s 2019 deal with OpenAI as giving the company “contractual control over a horizontal competitor’s supply chain.” According to the filing, this arrangement allowed Microsoft to “profit twice—first from compute sales, and again from the very AI product it constrains.” The plaintiffs allege they overpaid for ChatGPT Plus subscriptions from November 2022 through February 2025 and received degraded service during this period.
Price Impact and Market Definition
Perhaps the most striking evidence cited in the complaint involves what happened when OpenAI began purchasing compute from Google Cloud in June 2025. The lawsuit claims that once Microsoft’s exclusivity ended, ChatGPT token prices dropped by 80 percent within weeks. This dramatic price shift is characterized as a “powerful natural experiment” demonstrating the effects of Microsoft’s alleged anticompetitive behavior.
The plaintiffs have defined a new antitrust market they call the Consumer Generative AI Market, which includes subscription products like ChatGPT Plus, Claude Pro, Gemini Advanced, and DeepSeek Chat. They argue that Microsoft’s actions affected pricing and service quality across this entire market segment.
Legal Precedent and Current Status
The lawsuit draws parallels to Microsoft’s 1990s antitrust battles, calling the company a “recidivist violator” that has “ported the same exclusionary playbook into AI.” Legal experts note that the strength of the case may depend on whether Microsoft actually exercised control over OpenAI’s compute resources or merely had the contractual ability to do so.
Navodaya Singh Rajpurohit, a legal partner at Coinque Consulting, told Decrypt that “restraint of trade turns on control.” He suggested that internal emails and capacity records could serve as evidence if the exclusive agreement itself isn’t available.
Ongoing Developments and Remedies Sought
The class action arrives during significant shifts in the Microsoft-OpenAI relationship. Japan’s SoftBank is reportedly negotiating to invest up to $25 billion in OpenAI, which would surpass Microsoft’s $13 billion stake. Meanwhile, Microsoft has agreed under the Stargate project to end its exclusive cloud provider status.
Plaintiffs are seeking monetary damages for overpayment and a permanent injunction that would bar Microsoft from exclusive compute deals with OpenAI. They also want disclosure of internal communications regarding compute supply, pricing, and integration. Legal experts suggest courts could order changes to the OpenAI arrangement and set guardrails to prevent future anticompetitive behavior.
The complaint alleges that Microsoft “still retains the contractual ability to restrict OpenAI’s compute purchases,” describing this power as remaining “as a sword of Damocles over OpenAI, wielded by one of its principal competitors.” Neither Microsoft nor OpenAI has responded to requests for comment on the lawsuit.
