Daily AI Newsletter: Former head of NSA joins OpenAI board

In today’s email:

🤑 Clearview AI Used Your Face. Now You May Get a Stake in the Company.
☠️ Tesla shareholders sue Musk for starting competing AI company
📚 No BS Intro To Developing With LLMs
🧰 10 new AI-powered tools and resources. Make sure to check the online version for the full list of tools.

Former head of NSA joins OpenAI board

OpenAI has appointed Paul M. Nakasone, a retired general of the US Army and former head of the National Security Agency (NSA), to its board of directors. Nakasone, who led the NSA from 2018 until his resignation in February, was initially appointed by former President Donald Trump. Before leaving the NSA, he supported the renewal of Section 702 of the Foreign Intelligence Surveillance Act. At OpenAI, Nakasone will join the Safety and Security Committee, led by CEO Sam Altman, to help enhance cybersecurity measures and improve the detection and response to cyber threats.

Recent changes at OpenAI highlight a focus on safety, with notable departures including co-founder and chief scientist Ilya Sutskever, who played a significant role in the recent controversy surrounding CEO Sam Altman's brief departure and return. Another key figure, Jan Leike, also resigned, citing concerns that safety protocols were being overshadowed by the pursuit of new products. These shifts underscore the growing importance of maintaining robust safety practices within the company.

Bret Taylor, the chair of OpenAI’s board, emphasized the crucial role of secure innovation in realizing the full potential of artificial intelligence. He noted that Nakasone's extensive expertise in cybersecurity would be instrumental in guiding OpenAI towards its mission of ensuring that artificial general intelligence benefits all of humanity. The board now includes prominent members such as Altman, Adam D’Angelo, Larry Summers, and others, with Microsoft’s Dee Templeton serving as a non-voting observer.

Bitcoin miners at Donald Trump’s closed-door event say he thinks bitcoin can help win AI arms race

Former President Donald Trump recently met with top Bitcoin miners at Mar-a-Lago, discussing the future of Bitcoin mining in the U.S. and its potential role in addressing America's energy deficit and AI technology race. Trump, now accepting digital currency donations for his campaign, emphasized the importance of domestic Bitcoin mining to maintain U.S. leadership in technology and energy independence. The meeting, attended by representatives from major Bitcoin mining companies, highlighted the potential job creation and infrastructure benefits of expanding the industry within the country.

During the closed-door session, Trump expressed his interest in Bitcoin as a defense against a central bank digital currency (CBDC) and discussed the potential of Bitcoin mining to support renewable energy sources and stabilize the power grid. The miners praised Trump's knowledge and engagement, noting his understanding of the intricate relationship between energy production, AI demands, and Bitcoin mining. This approach aligns with his "America First" agenda, aiming to ensure that the U.S. remains at the forefront of emerging technologies and energy solutions.

Trump's pro-Bitcoin stance contrasts sharply with the Biden administration's regulatory approach, which includes proposals like a 30% tax on electricity used by crypto miners. The meeting with Bitcoin industry leaders is part of a broader strategy to make cryptocurrency a key issue in the 2024 presidential election, with significant financial backing and voter mobilization efforts from the crypto community. The discussions also included the promotion of U.S.-made mining equipment and the potential revival of fossil fuels and nuclear energy to meet the growing energy demands of AI and data centers.

Clearview AI Used Your Face. Now You May Get a Stake in the Company.

Clearview AI, a facial recognition start-up, has agreed to a unique settlement in a class-action lawsuit accusing it of privacy invasion. Instead of cash, the company will offer a 23 percent stake to Americans whose faces were scraped from the internet to build its database, used by law enforcement and government agencies. Valued at $225 million, the stake is worth about $52 million. This settlement, pending approval, allows claimants to potentially benefit from future profits if the company goes public or is acquired, or they could opt for a revenue share after two years.

The lawsuit, consolidated in a federal court in Chicago, was prompted by Clearview AI's controversial data collection methods, which involved scraping billions of photos from social media platforms without consent. The litigation has been financially draining for the company, leading to this creative settlement solution. Lawyers for the plaintiffs believe this approach provides a future financial benefit from the company’s potential growth, contrasting traditional monetary settlements.

Critics, however, argue that the settlement presents ethical concerns. Jay Edelson, a class-action lawyer, and Evan Greer, director of the privacy advocacy group Fight for the Future, both express discomfort with the idea of those harmed by privacy violations becoming stakeholders in the company responsible. They believe the remedy should focus on stopping harmful practices rather than offering financial compensation linked to the continuation of those practices.

Tesla shareholders sue Musk for starting competing AI company

Tesla shareholders have filed a lawsuit against CEO Elon Musk and members of the automaker's board, accusing Musk of starting a competing AI company, xAI, and diverting talent and resources from Tesla to the new venture. The lawsuit, filed by the Cleveland Bakers and Teamsters Pension Fund and other shareholders in Delaware Chancery Court, alleges that Musk and the board breached their fiduciary duties and unjustly enriched Musk. The shareholders are seeking to force Musk to relinquish his stake in xAI to Tesla, arguing that his actions violate Tesla's code of business ethics.

The complaint highlights Musk's threat to develop AI outside of Tesla unless granted more voting control over the company, a move that coincides with Tesla's annual meeting to re-ratify a $56 billion compensation package for Musk. The plaintiffs argue that Musk's claim of Tesla being an AI company has inflated its stock value, and they point to at least 11 employees who have moved from Tesla to xAI. Additionally, they cite Musk's diversion of AI processors from Nvidia, originally reserved for Tesla, to his social media company X, formerly known as Twitter.

Musk launched xAI in 2023 with $6 billion in funding, aiming to compete with companies like OpenAI, Microsoft, and Alphabet. The plaintiffs argue that Tesla's board has failed to protect the interests of Tesla and its shareholders, allowing Musk to prioritize his new venture at the expense of the automaker. They assert that the board's failure to address Musk's actions represents a significant breach of fiduciary duty, highlighting a history of the board's deference to Musk's decisions.