Eleven consumers filed a proposed class action against Microsoft in October 2025, alleging that the company’s exclusive cloud computing arrangement with OpenAI let it control the compute supply behind ChatGPT and drive up prices for millions of users. The case, filed in the U.S. District Court for the Northern District of California, accuses Microsoft of using its Azure platform to box out competitors while OpenAI’s own product depended entirely on Microsoft’s infrastructure.
The lawsuit is one of the first tests of how courts will treat exclusive dealing arrangements in the AI industry, and it offers a preview of the antitrust exposure facing dominant cloud providers as they race to lock up the infrastructure that AI companies need to operate.
What the Lawsuit Alleges
According to the complaint, Microsoft required OpenAI to run its AI workloads exclusively on Azure in exchange for its investment, which now exceeds $13 billion. The plaintiffs argue that this arrangement gave Microsoft the power to control how much computing capacity OpenAI could access, and that Microsoft used this leverage to keep prices for ChatGPT subscriptions elevated while it developed competing products of its own, including Copilot.
The plaintiffs also point to a period during a 2025 price war when they say ChatGPT Plus subscriptions cost far more than rival AI subscription products, which they attribute to the restricted compute supply. Although some of the contractual restraints on OpenAI have since loosened, the plaintiffs argue that Microsoft retains the contractual right to reimpose them going forward.
Exclusive Dealing Agreements Can Violate Federal Antitrust Law
Exclusive dealing arrangements are not automatically illegal. Companies routinely enter into agreements that give one party priority access to a supplier’s capacity, and courts recognize that these arrangements can serve real business purposes, such as securing supply or justifying investment. Concerns arise when a dominant company uses an exclusive arrangement to foreclose competitors from an input they need to compete.
Claims like this can be brought under Section 1 of the Sherman Act, which prohibits agreements that unreasonably restrain trade, or Section 2, which prohibits companies from using exclusionary conduct to acquire or maintain monopoly power. Courts weigh how much of the market the exclusive arrangement forecloses, whether alternatives exist for parties shut out of the arrangement, and how long the restriction lasts. A business justification, such as protecting an investment, can weigh in a company’s favor, but it does not excuse conduct that locks up an essential input and leaves rivals with nowhere else to turn.
The lawsuit against Microsoft draws an explicit comparison to the government’s earlier case against the company. In the 1990s, the Department of Justice successfully argued that Microsoft violated the Sherman Act by tying its web browser to its dominant operating system and locking up distribution channels that rival browsers needed to reach users.
The plaintiffs in the current case argue that Microsoft has adopted a similar strategy for the AI era, this time by controlling the supply that AI competitors need rather than distribution.
How Exclusive Compute Deals Can Harm Competition and Consumers
As AI companies race to secure the computing power needed to train and run their models, a handful of hyperscale cloud providers control most of the infrastructure that smaller AI companies depend on. When one of these providers ties up a key AI developer’s compute needs through an exclusivity clause, rival AI companies and cloud providers can be left without a comparable option, and the AI company bound by the exclusive deal may have little room to negotiate better terms elsewhere.
Consumers can be harmed even without knowing the arrangement exists. Higher input costs and reduced competition can translate directly into higher subscription prices, slower product improvements, and fewer choices in the market.
These arrangements are not limited to cloud computing contracts. Similar dynamics can show up in agreements covering data center power supply, specialized AI hardware, or access to training data, wherever a dominant company can use its position to tie up something a competitor needs.
Businesses and Consumers Harmed by These Arrangements Have Options
If a company you do business with, compete against, or purchase services from has been locked out of essential infrastructure or has passed along inflated costs because of an exclusive arrangement like this one, you may have a claim under federal antitrust law. Keller Grover has represented plaintiffs in some of the largest antitrust class actions in the country, including cases that resulted in billions of dollars in settlements against dominant companies that used their market position to restrict competition.
If you believe you have paid higher prices or lost business opportunities because of anticompetitive conduct in the AI or technology industry, contact Keller Grover’s antitrust litigation team to discuss your rights. Reach out to our office today to learn more about pursuing a claim.