A lawyer for billionaire Elon Musk has asked attorney generals in the states of California and Delaware to push OpenAI to auction a major stake in its business to decide fair value of its charitable asset during its corporate restructuring, sources familiar with the matter told Reuters on Thursday.

Musk's attorney Marc Toberoff sent a letter to the states' top law officers on Tuesday in which he argued they should provide a process for competitive bidding to determine fair market value of OpenAI's charitable assets to "protect the public's beneficial interest," as the startup is working on removing the control of its non-profit, according to the sources.

"Elon is engaging in lawfare. We remain focused on our mission and work," OpenAI spokesperson said in a statement. The startup previously said the valuation of its charitable assets will be determined by independent financial advisors. Financial Times reported the letter earlier in the day.

Sam Altman co-founded OpenAI alongside Musk and others, and became one of the technology world's biggest names after the 2022 launch of the artificial intelligence tool ChatGPT. Backed by Microsoft, OpenAI was valued at $157 billion in October after raising $6.6 billion from investors.

Reuters first reported the ChatGPT maker's plan to revamp its corporate structure so its for-profit business would be independent from non-profit control in September. The company outlined the plan in detail late December, saying it would create a public benefit corporation to make it easier to "raise more capital than we'd imagined" and the plan would result in "one of the best resourced non-profits in history."

Musk, who owns AI startup xAI, is suing OpenAI in courts in an effort to block OpenAI's conversion, which it had argued as a departure of the mission he funded the company on. The court is likely to rule on the preliminary injunction Musk's lawyers had applied for later this month.

Delaware Attorney General Kathy Jennings weighed in on the case by sending the court an amicus brief on Dec. 29, stating she is currently reviewing OpenAI's proposed changes.

"That Delaware is on record asserting that it is closely monitoring the situation should definitely undercut a judge's willingness to enjoin a transaction Musk and Encode characterize as dangerous, unwise, or the product of fiduciary violations," Darryll Jones, Professor of Law at Florida A&M University wrote in a blog. Encode is an AI safety non-profit that joined Musk's efforts to block OpenAI's for-profit transition.

California Attorney General Rob Bonta, who also has jurisdiction, has not commented on the case, despite a letter from Meta urging him to block it.