Monday, 7 April 2025

Bill To Block OpenAI’s For-Profit Conversion Is Now An Aircraft Lien Bill

AB-501, a California bill introduced by Diane Papan that would have prevented OpenAI from transitioning to a for-profit, has mysteriously transitioned into an aircraft lien bill.

Papan introduced AB-501 in response to concerns about OpenAI’s intention to become a for-profit company. The company was founded as a non-profit, with the stated goal of developing safe and responsible AI. As the company has grown and enjoyed more success, many have accused it of abandoning its founding principle in the pursuit of profit.

AB-501 was designed to reign in such behavior, specifically by prohibiting “a startup venture capital nonprofit from converting into a mutual benefit corporation, public benefit corporation, social purpose corporation, business corporation, or any other wholly or partially for-profit entity or form.”

The bill itself has undergone a major conversion, now dealing exclusively with aircraft liens.

AB 501, as amended, Papan. Startup venture capital nonprofits: transfers. Liens on aircraft: sale.
Under existing law a person has a lien, dependent upon possession, for the amount the person is owed for any services, materials, or storage provided for any aircraft, unless specified exceptions apply. If the lienholder is not paid the amount due within 10 days of its due date, the lienholder may sell the property at public auction. Prior to selling the property, the lienholder must publish a notice of sale in a newspaper published in the county or, if there is no such newspaper, in three of the most public places in the city or place where airplanes are sold, as specified.

This bill would increase the notice requirement to require the lienholder, where there is no newspaper in the county, to publish a notice of sale in five of the most public places in the city or place where airplanes are sold.

AB-501 Changes

Gary Marcus, Scientist and Author, say his sources assure him the change is not a clerical error, but an intentional change in AB-501. Marcus also says there are rumors that Altman called Papan shortly before the change to the bill was made, raising serious questions about what was said during that call.

To date, there has been no statement from Papan on the reason for the change in AB-501, leaving many who signed an open letter supporting the original bill feeling betrayed.

More important, however, are questions about why the bill was changed, why there has been no public acknowledgment of the change, and what was said between Altman and Papan that led to such an unexplained and drastic change.



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