xAI, the AI-focused firm headed by Elon Musk, has come face to face with a new legal challenge. An Ethereum-based gaming network has filed a lawsuit against Musk’s xAI citing trademark infringement as the primary issue. The name of this gaming network is — Xai.
The Xai gaming ecosystem is operated and managed by Ex Populus, a Dealware-based Web3 game publishing company. It has filed its complaint against Musk’s AI firm in the Northern District of California.
Demanding a jury trial, the complaint has accused Musk of practicing unfair competition and unfair business practices while infringing on the brand’s name which, the company claims, has been in existence since June 2023. Musk, on the other hand, had announced his AI firm xAI in July 2023.
“The XAI mark is protected by a federal trademark registration and common law rights (‘XAI Trademark’), in United States commerce,” the filing said, accusing Musk of ignoring the gaming network’s trademark rights.
The lawsuit further claims that Musk’s November 2024 post, in which he announced that xAI was planning to start an AI game studio, was an invasion into a market where the plaintiff had already established its brand.
“Over 36 million people saw Musk’s X post. Plaintiff’s goodwill in its XAI brand was almost immediately overrun and actual confusion was rampant. Consumers familiar with Plaintiff’s XAI brand and its established reputation in the video gaming industry instantly began inaccurately conflating Plaintiff with Musk’s/Defendants’ ‘xAI’ company,” the filing added.
Ex Populus is looking for a court-ordered restriction on Musk using the disputed xAI name to promote gaming and blockchain services. It is also seeking damages for infringement.
Musk is yet to react to the development.
On August 22, the billionaire tech mogul in a rather catchy wordplay did announce that xAI will start working on a “purely AI software firm” called “Macrohard”.
“It’s a tongue-in-cheek name, but the project is very real!” he quipped, announcing the plans.