- Microsoft seeks dismissal of lawsuit alleging Azure exclusivity inflated ChatGPT subscription price
- Judge questions arbitration claims linked to OpenAI deals and Microsoft legal arguments
- Subscribers argue that computing supply constraints limited production and increased service costs.
A group of ChatGPT Plus subscribers is facing a pushback in court after Microsoft asked a federal judge to dismiss their antitrust lawsuit, arguing that the claims hinge on speculation rather than direct proof of harm.
The case (you can download a PDF of the complaint here) centers on allegations that cooperation between Microsoft and OpenAI led to higher prices and weaker quality of service.
Microsoft told the court that the lawsuit should be dismissed because the subscribers purchased services from OpenAI, not Microsoft. This separation, he argued, means that plaintiffs cannot prove the type of direct harm required by antitrust law.
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In arbitration, not in federal court.
If the judge decides the case should continue, Microsoft said the dispute belongs in arbitration and not in federal court. Its outside counsel, Julia Chapman, argued that users agreed to arbitration terms by signing up for ChatGPT, and those same terms should extend to claims closely related to the service.
“There is an equitable estoppel to prevent plaintiffs from doing just that,” Chapman said.
The plaintiffs’ attorneys disagreed, arguing that the subscribers never agreed to resolve disputes with Microsoft through arbitration.
His attorney Briane Dunne told the court that extending arbitration protections to a company outside of the original agreement goes beyond what the doctrine allows.
Judge P. Casey Pitts raised questions about the arbitration argument during the hearing. He indicated there could be connections between the deals, but questioned whether OpenAI’s terms should control claims brought against Microsoft.
“There may be some ‘overlap,'” Pitts said, “but it’s not clear to me why I would have to think about the OpenAI deal.”
The dispute centers on claims that Microsoft required OpenAI to rely exclusively on its Azure systems to supply the computing resources needed to run ChatGPT.
The plaintiffs argue that reliance on a single supplier limited production and contributed to higher costs and slower improvements in service.
Microsoft rejected those claims, saying subscription prices are set solely by OpenAI and not Microsoft.
Their legal team also argued that the alleged deal concerns cloud infrastructure services, while the plaintiffs allege damage to the consumer AI market, creating a gap that could weaken the antitrust case.
“This is not an illegal horizontal agreement per se,” Cohen said. “That is very clear in the law.”
Judge Pitts did not indicate how he plans to rule, leaving both the dismissal and arbitration requests unresolved for now.
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