Abdulrahman Alfozan, the 35-year-old former OpenAI engineer, appeared in court today wearing an orange jumpsuit and white face mask while escorted by two U.S. marshals. He will remain in federal custody until his next court date, a preliminary hearing on Nov. 6. He has been in jail since the FBI arrested him on Oct. 9, alleging he planted the device in a conference room where executives, and sometimes government officials, discussed sensitive information, on Sept. 28.

Magistrate Judge Alex G. Tse said a $1 million bond had to be weighed against the possibility that Alfozan “potentially has access to much greater wealth.”

“Once he leaves, there’s no getting him back, and that’s why this is a bigger case,” Tse said in the courtroom Monday morning.

OpenAI terminated Alfozan’s employment on Oct. 9, although Alfozan’s lawyer said Monday in court the company never formally told him that. However, per his defense motion, he was told before his arrest that he had been placed on administrative leave. Tse noted that OpenAI would not have fired him if it had no concern about what it found.

Fortune was in the San Francisco courtroom for the hearing, as were about 60 others, including a group of high school students who had come to witness a case involving one of the most prominent companies in the world.

Ahead of the court hearing Monday, both prosecutors for the federal government and the defense, Alfozan’s attorney William Pernik, filed court documents revealing new details about the case. Alfozan sought release from federal custody, with supervision, such as an ankle monitor, while the U.S. argued there was reason to believe he would leave the country and that he posed a danger to the community and to U.S. national security.

Alfozan faces one count of using or attempting to use a device to intercept oral communications, which carries a maximum of five years in prison. He was charged by criminal complaint and has not been indicted or entered a plea. The complaint does not charge him with espionage, theft of trade secrets, or acting as an agent of a foreign government, a point his defense stressed in its motion. OpenAI has said it has “no indications” that he inappropriately accessed or took model weights, source code, or customer data.

The filings reveal far more than has been known to date about Alfozan and some of the most controversial details of the case, including why Alfozan had a one-way flight booked to Saudi Arabia three days after his arrest. Alfozan’s lawyer said he is a citizen of Saudi Arabia, although he has been in the U.S. for 15 years; got his green card in 2020; and joined OpenAI in 2025.

A one-way ticket to Saudi Arabia and potential plans to move back

Alfozan booked the flight to Saudi Arabia on Sept. 13, according to the defense motion, along with his wife, also a Saudi national, and 3-month-old baby. The economy fare for all three cost $1,897.59 and could be changed for a $180 fee, the defense said, adding this wasn’t unusual for its client: Alfozan often books one-way tickets to allow for scheduling flexibility around his work schedule, the defense motion says. In fact, 70% (96 of 138) of the airline bookings “in his email since January 2021 were one-way tickets.” His naturalization application lists 25 trips abroad between 2020 and 2025, 20 of which included Saudi Arabia, and he returned from every one, according to the defense.

As for the date of Oct. 12, Alfozan booked it for then because that’s the day his wife’s 60-day grace period ended after her work permit in the U.S. expired on Aug. 13. Since giving birth, she has “struggled with postpartum depression and anxiety,” the defense motion says. Alfozan filed for paternity leave from OpenAI, set for Oct. 19 to Dec. 20, after which he planned to return to the Bay Area and his role at OpenAI.

After Alfozan’s arrest, his wife allegedly told authorities that she and their baby intended to permanently move to Saudi Arabia, according to the court filing. She told them her husband intended to move there at some point to be with them, but for now, was spending two months of his paternity leave in the country before returning to the U.S. In court Monday, however, the defense said she now plans to return to the U.S. on a temporary, short-term B-1 visa. The defense also said she left the U.S. rather than overstay her visa.

That is consistent with a letter one of Alfozan’s friends submitted for the defense motion, in which the friend says he spoke to Alfozan about his plan to continue working in the U.S. and supporting his wife and baby when they returned to Saudi Arabia.

As further evidence of Alfozan’s intent to return to the U.S., his lawyer notes that on Sept. 26, two days before he allegedly planted the device, Alfozan registered to attend the Consumer Electronics Show (CES), a convention in Las Vegas scheduled for early January 2027.

In court, Pernik argued that Alfozan stayed in the country for about eight to 10 days after OpenAI confronted him. “If he really were an agent of a foreign government … why wouldn’t he just leave right away?” Pernik said in court.

Evidence found on his iPhone

The U.S. filing also reveals the results of a federal search of Alfozan’s home and cell phone. They found “several electronic components similar” to the recording device Alfozan allegedly installed behind a TV in the conference room, and a second one OpenAI security staff found in his bag.

On Alfozan’s iPhone were several photographs, dated from Sept. 22 to Sept. 28, 2026, of another recording device. Other photos showed what appeared to be the input and output panels on televisions and other devices in “various locations in OpenAI buildings” including another conference room where “sensitive meetings” frequently occurred, according to the filing. This suggested Alfozan “had done reconnaissance at OpenAI to determine where he might install additional devices,” the U.S. filing says.

Also on Alfozan’s iPhone was a note he had deleted from September 2026, which had links to different recording devices, including ones made by Seeed Studio, the type of device Alfozan allegedly put in the conference room and which had been found at his residence.

Two other notes stood out. One titled “Riyadh tasks,” last modified Sept. 13—the day he booked the flight—listed finding an apartment and a job for his wife and getting a Saudi passport for his son. Another, titled “OpenAI leave” and last modified Oct. 7, suggested he planned an “early … pick up” of the devices and extending his leave “to full,” according to the U.S. filing. His wife also told FBI agents she had seen her ChatGPT account open on her husband’s laptop, the filing says.

In court, Pernik disputed the government’s account of the room. “This was an open room where anyone could walk in,” he said, adding that Alfozan held meetings and led teams there. The complaint, however, says Alfozan had no authority to enter the room or take part in meetings there.

“OpenAI encouraged Mr. Alfozan to be involved with Saudi Arabia,” Pernik said.

Prosecutors said in court they don’t know what information Alfozan may have tried to take out of OpenAI and the U.S. “That is the concern, that something is going to leave OpenAI and the U.S., and quite frankly we don’t even know what that is,” Assistant U.S. Attorney Nick Parker said.

The court filings also reveal Alfozan’s browser history, which allegedly shows he accessed a folder called “Saudi Gov Docs” on Oct. 4, 2026. Between July 6 and Sept. 21, 2026, he queried an internal OpenAI productivity tool about which OpenAI staff could be suitable to attend a high-level informal meeting with ministers in Saudi Arabia, and about planned OpenAI visits to Saudi Arabia. He also asked the tool on Sept. 7 who at OpenAI might be likely to attend a meeting with the Saudi state–backed AI company Humain and the Ministry of Communications and Information Technology (MCIT) of Saudi Arabia.

He asked the tool about matters related to MCIT again on Sept. 8, such as an upcoming Saudi MCIT visit on Sept. 9, as well as on Sept. 21. Alfozan’s base salary at OpenAI was $385,000, (up from $325,000 when he was hired) plus a $2.2 million new-hire equity grant.

“OpenAI encouraged Mr. Alfozan to be involved with Saudi Arabia,” Pernik said in court.

Returning to Saudi Arabia

Alfozan’s wife and child left the U.S. within 36 hours of his arrest. They did not take the originally planned Oct. 12 flight. Instead, the Saudi government first booked and paid for another one-way ticket for her and their son to Jeddah, Saudi Arabia, on Oct. 11. However, they also did not take that flight, but rather left a day earlier on Oct. 10 on another business class flight to Qatar booked and paid for by a member of the Saudi military, court documents say.

In court Monday, the defense specified that Alfozan’s brother-in-law (his wife’s sister’s husband) booked the flight. He works in the Saudi government, and paid for the flight with his own money.

The Saudi Consulate General in Los Angeles said in an Oct. 14 letter, filed with the defense motion, that it stands ready to cover the full amount of any bail bond the court requires. It also told Pretrial Services in writing that it “will not issue any travel documents” to Alfozan while he is on release. In court, Pernik said the Saudi government was willing to guarantee $1 million, “giving their full faith and credit,” and would notify the State Department. Tse asked whether the offer amounted to Saudi Arabia keeping him in the U.S. so it wouldn’t lose its money. Pernik said the relationship mattered more than the $1 million.

Alfozan was “in frequent communication via WhatsApp with a member of the Saudi Royal Family,” the U.S. alleges in its motion. The unnamed royal allegedly tried to recruit Alfozan for an AI initiative being launched in Saudi Arabia, and asked Alfozan when he would leave OpenAI. Alfozan allegedly said he wouldn’t leave until his stock vested, the government’s detention memo read.

Alfozan communicated with the unnamed royal as recently as Oct. 5, 2026, court documents say. In May 2026, the royal told Alfozan, “Saudi needs you more then [sic] the US!” Alfozan responded, “100,” indicating agreement.

Alfozan had applied in July to a program for young Saudi Arabian leaders, the Misk Foundation’s 2030 Leaders program, according to the U.S. filing. He had proceeded to the second stage of the process, and checked the status of his application, as recently as Sept. 4, filings say. The program would have required him to take part in person in Riyadh, the filing says.

At the same time, Alfozan was on the “verge” of getting U.S. citizenship, the defense motion says. A day after OpenAI found the device, on Oct. 1, 2026, the U.S. Citizenship and Immigration Services notified him that his citizenship interview was set for Nov. 6, 2026. This was “a long-held dream for the Alfozan family, as it is for so many immigrants,” reads the defense motion. That interview has since been postponed because of the case, and his next court date is set for Nov. 6, the date of the originally scheduled interview. The defense also told the court that Alfozan had worked and paid taxes in the U.S. for years, and had disclosed even traffic tickets on his citizenship application.

“His plan was always to return to the Bay Area, where his home, his career, and his community are,” the defense motion says. “The evidence shows that Mr. Alfozan planned to accompany his wife and son to Saudi Arabia for his paternity leave and then return.”

Time flies when you’re having fun, building drones, and waiting to hold an IPO! Barely 18 months ago, I took a look at “unicorn” company Anduril Industries, its $1 billion in 2024 sales, and its $30 private market valuation — and decided the stock was probably overvalued at 30 times sales. (Most traditional defense companies are fairly valued closer to 1 times sales.)

But somebody disagreed.

Actually, a lot of somebodies.

In a funding round held in May 2026, private market investors valued the defense technology upstart at twice the price at which I had dismissed it just one year earlier — $61 billion. And five months later, we just learned that Anduril’s valuation has jumped again, by nearly 50%.

CNBC reports on Anduril

As CNBC reported earlier this week, Anduril has filed notice that it will hold a “tender offer” to permit some of its employees to cash in their stock options and stock holdings in the company. According to the news agency, the new private market value of Anduril stock will be “roughly $90 billion.”

Which is to say, 48% more than Anduril was worth just five months ago, and up 3 times from its valuation in June 2025.

But is that valuation justified?

How to value Anduril stock (just in case it IPOs)

Anduril CEO Palmer Luckey is on record saying it’s “important” that his company hold an initial public offering. When that happens, the question of valuation will become urgent for investors — at least those who don’t want to lose money on the IPO. With that in mind, here’s how I look at Anduril’s valuation:

Thirty times sales seemed obviously overvalued to me last year. Now, the good news is that Anduril isn’t generating $1 billion in revenue a year anymore. According to a March Reuters report, the company is on track to generate $4.3 billion in sales this year. So a $90 billion valuation implies the stock is selling for “only” about 21 times sales.

(Hint: Even that is too much.)

Worse, Anduril isn’t actually making money on those sales. Reuters estimates Anduril will lose $1 billion this year, and other sources suggest the company won’t turn its first profit before 2030.

Oh, and all this was before Anduril promised to spend $3.7 billion building an incredibly capital-intensive shipyard to produce submarine parts for the U.S. Navy.

Make no mistake: I’m a fan of Anduril as a company, and I love the idea that it is producing military hardware at affordable prices and shaking up the Pentagon’s procurement process to encourage America’s military to spend its money more wisely.

Much as I like the company, however, I’m afraid that as an IPO and as a stock, Anduril is going to end up looking vastly overpriced.