xAI warns staff to limit contact with Cursor employees

xAI told employees to restrict interactions with Cursor personnel to only what is necessary for a technical partnership announced in April. Cursor employees were already working inside xAI offices and collaborating on projects for weeks, while the legal guidance arrived later. The partnership is described as legally separate from a potential acquisition in which SpaceX has an option to buy Cursor for $60 billion. US antitrust law prohibits gun-jumping, including intermingling assets or joint business decisions before regulatory approval. Employees were warned that conversations could be subpoenaed during review, and improper evidence could jeopardize the transaction.

"Burnham sent guidelines to xAI personnel last week instructing them that interactions with Cursor staff should not go beyond what is needed to carry out a technical partnership announced in April. That partnership allows the two companies to collaborate on computing resources and coding. It is legally separate from the potential acquisition."

"The problem is timing. Cursor employees are already working inside xAI's offices. The two teams have been collaborating on projects for weeks. The legal guidance that should have preceded that collaboration arrived after it was well under way."

"US antitrust law prohibits what regulators call gun-jumping, the intermingling of assets or joint business decisions between merging companies before the deal receives approval from the Justice Department or Federal Trade Commission. Violations carry steep financial penalties and can delay or derail a transaction."

"Burnham's email reminded staff that xAI and Cursor remain legally separate entities and must operate independently until the deal, if it proceeds, receives regulatory clearance. Employees were told their conversations could be subpoenaed during the regulatory review. Any evidence that the two sides improperly combined operations could put the entire deal at risk."

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