Xai Files Lawsuit Against Elon Musk’s xAI Over Trademark Controversy

The Ethereum-based gaming network Xai has initiated legal action against Elon Musk’s artificial intelligence company xAI, alleging trademark infringement and unfair competition.

The complaint, filed in the Northern District of California on Thursday, asserts that Musk’s xAI has created significant market confusion, harming Xai’s brand.

Ex Populus, the Delaware corporation responsible for Xai, stated it has utilized the XAI trademark in US commerce since June 2023, notably through its blockchain gaming ecosystem and the $XAI token. “This is a classic instance of trademark infringement that demands the Court’s intervention to address,” the filing said.

Ex Populus oversees the Xai ecosystem, a blockchain-based network tailored for video gaming and digital transactions, providing infrastructure that supports game logic, AI-driven decisions, rewards, and data management across various applications, as mentioned in the filing.

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xAI gaming studio sparks additional confusion

The complaint indicates that confusion arose following Musk’s announcement of xAI in July 2023 and intensified when he revealed in November 2024 that xAI intended to establish a gaming studio.

The filing asserts that “marketplace confusion flourished regarding whether Defendants/Musk were associated with, owned, or endorsed Plaintiff’s XAI Trademark or its associated goods and services.” It provided instances of consumers, publications, and even Musk’s AI assistant Grok erroneously tying the two entities together.

Ex Populus contended that the reputational damage transcends mere loss of goodwill. The complaint highlights that Xai has encountered “significant negative consumer sentiment” fueled by Musk’s controversial public persona and issues linked to xAI products.

“Plaintiff is not only facing irreparable harm from losing control over its hard-earned goodwill with the XAI Trademark… but also experiencing damage due to the confusing association with Elon Musk, which has led to substantial negative consumer sentiment,” the filing states.

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Musk’s team pressured Xai regarding trademark rights

The filing accuses Musk’s legal representatives of attempting to coerce Ex Populus into abandoning its rights by threatening to cancel its registration earlier this month.

The lawsuit also mentioned that the US Patent and Trademark Office has already suspended several of Musk’s xAI trademark applications due to a likelihood of confusion with Xai’s existing mark.