Elon Musk is once again at the center of a branding controversy—this time involving the name of xAI’s chatbot, Grok. A startup founder says Musk’s company is infringing on a previously claimed trademark, sparking a potential legal battle over naming rights in the AI space.
The Origin of ‘Grok’ and the Trademark Tangle
Elon Musk has publicly stated that the name “Grok” was inspired by the 1961 science fiction novel Stranger in a Strange Land by Robert A. Heinlein, where the term means “to understand.” However, Ron Shah, founder of the AI startup Bizly, says he coined the name during a brainstorming session in 2021 and applied for a trademark shortly after.
Shah’s version of Grok was intended for an AI-powered live events app, and by 2023, the company was piloting the product with Carta, a financial services platform. But the launch plans hit a wall when Musk introduced his own AI chatbot named Grok under the xAI brand.
Musk’s Legal History with Trademarks
This isn’t the first time Musk has been caught in a branding dispute. Earlier, his company X (formerly Twitter) settled a lawsuit with a PR firm that claimed ownership of the “X” trademark. And now, xAI’s application for a Grok trademark is in limbo, suspended by the U.S. Patent and Trademark Office due to potential conflicts with existing trademarks held by Groq, an AI chipmaker, and Grokstream, a software company.
Trademark attorney Josh Gerben notes that U.S. trademark law primarily aims to protect consumers from confusion, not companies. The key issue is whether the products operate in the same industry and are likely to be mistaken for one another.
The Fallout for the Startup
Shah claims the unexpected overlap with Musk’s chatbot caused severe financial damage to his startup. Bizly was on the verge of closing a funding round when the news broke, but investor confidence evaporated. “We spent $2 million building Grok, and the funding collapsed after Musk’s announcement,” Shah wrote in an email to xAI’s legal team. He even offered to sell the trademark or partner with xAI to salvage the business.
Despite reaching out, Shah says he received no response from Musk’s team. His startup, still in beta and never fully launched, is now teetering on the edge of closure.
Trademark Law: A Gray Area
The legal nuances may not be on Shah’s side. Under trademark law, to gain full protection, a brand must be actively used in commerce across state lines. While you can file an “intent to use” application, the trademark isn’t enforceable until the product is commercially available in at least two states.
The fact that Bizly’s app was still under pilot testing when xAI launched Grok could weaken their legal claim to the name. However, the situation underscores how fast-moving tech giants can inadvertently—or perhaps intentionally—overshadow smaller innovators.
Musk’s Pattern of Pushing Boundaries
Elon Musk has a history of testing the limits of rules and regulations, particularly when it comes to branding. When he rebranded Twitter to “X,” Apple made an exception to its App Store naming rules for him. Similarly, Musk’s recent $33 billion merger of xAI with X demonstrates his expansive ambitions in AI and beyond.
What Comes Next?
Shah has yet to take formal legal action, fearing the cost and complexity of going up against one of the world’s wealthiest individuals. “Who am I to go legal with the richest man in the world?” he says. The lack of engagement from xAI has left Bizly in limbo, holding onto a name that may never see the light of day.
This case serves as a cautionary tale for startups navigating the volatile world of tech branding. The battle over “Grok” may be far from over—but for now, it’s a stark reminder that in Silicon Valley, even a great idea can be overshadowed by a bigger name and deeper pockets.
