WilmerHale’s investigation into Sam Altman’s dismissal from OpenAI serves double purposes—to assist the company in regaining trust, as well clarify the law firm’s position following a controversial congressional hearing during which it guided two university presidents.
The investigation aims to shed light on the reasons behind Altman’s termination at the Microsoft-supported startup. This information will aid OpenAI’s new board in making informed decisions, adding to the organization’s credibility, as noted by UCLA law professor James Park.
The investigation may also be seen as a means to regain employee and investor trust. According to Simon Gaugush, a Carlton Fields partner and former federal prosecutor, the probe “feels more like a showpiece” to restore confidence amongst investors and employees who saw Altman’s dismissal as disruptive.
WilmerHale’s reputation in handling crises and investigations, advising clients such as Meta Platforms Inc., PurduePharma, and large banks in Congressional and law enforcement scrutiny, has its benefits. Interestingly, the firm is currently representing New York Mayor Eric Adams in an FBI investigation over his campaign fundraising.
However, WilmerHale’s reputation was bruised when it guided Harvard University President Claudine Gay and University of Pennsylvania President Liz Magill at a congressional hearing concerning antisemitism on college campuses. The narrow and overly legalistic responses given by the presidents to questions raised some eyebrows. Interestingly, a reconstituted board at OpenAI announced the hiring of WilmerHale shortly after the congressional hearing, illustrating how clients are aware that not all attention is going to be favorable.
The investigation into OpenAI comes after Altman, the face of the organization, was suddenly dismissed for failing to be “consistently candid” in his communications with the board, leading to a series of events that saw him return as CEO after significant pressure from employees and investors. The incident triggered a leadership shakeup, with all original board members, except for one, replaced.
Microsoft Corp., which has a minority stake in OpenAI due to its $13 billion investment, has been given a non-voting, observing position on the three-person board. In the leadership turmoil, it was disclosed that several leading law firms were interviewed for the investigation, with WilmerHale being the chosen partner.
The investigation is being led by Hallie Levin and Anjan Sahni, two senior partners in WilmerHale’s New York office. Sahni, a former assistant US attorney in Manhattan, is expected to become the firm’s managing partner in the coming month. His client list this year includes Caroline Ellison.
Usually, such corporate investigations are designed to identify internal issues, often protected by attorney-client privilege, pinpoint compliance failures and preempt any stakeholder challenges over potential inaction. WilmerHale is regularly appointed to lead internal investigations, a trend increasingly prevalent in recent years as companies face intensifying scrutiny over issues such as sexual harassment and diversity.
The law firm has amassed considerable experience in high-profile internal investigations, with clients ranging from video game maker Activision Blizzard Inc, facing accusations of sexual harassment—leading to a hire of WilmerHale‘s Avakian and a subsequent $54 million settlement— to a civil rights audit of Starbucks Corp. amidst allegations of race bias.
Any findings generated from the OpenAI probe will only strengthen the legal industry as corporations continue to rely heavily on internal investigations to guide their decision-making processes.