Eliza Labs founder sues Elon Musk’s X over alleged anticompetitive actions and account suspension

Eliza Labs, an AI software company, has sued X Corp, alleging that the social media platform "wielded its incredible monopoly power" to suspend Eliza's account after extracting valuable knowledge from the AI firm.

In a Wednesday  filing with the federal court in San Francisco, Eliza Labs and its founder, Shaw Walters, claimed that X launched copycat AI products after obtaining key technical information from Eliza and then removing the company from the X platform.

"This case involves X Corp wielding its incredible monopoly power with perceived immunity from suit to deplatform users with the intent to restrain competition for launching AI Agents on the X Corp platform," the filing said.

The plaintiffs argued that X suspended the accounts of both Eliza Labs and Walters without warning or legitimate justification. 

"In the weeks leading to the deplatforming, X began to push plaintiffs to adopt an exorbitantly expensive 'Enterprise License' or 'Enterprise API' (for $50,000/month, or $600,000.00/year)," Eliza said in the filing, adding that it declined to pay for such services.

Eliza suggested that X's move "constituted a coordinated, fraudulent, and anticompetitive effort" to obtain money and technical intelligence from the plaintiffs regarding their open-source software development processes.

The Block has reached out to X and Eliza Labs for comment.

Eliza Labs is the creator of the $2.5 billion-valued elizaOS open-source protocol for autonomous AI agents. In April, it launched a no-code AI agent launchpad that enables users to develop advanced AI agents without requiring coding knowledge.