Two law firms fined $31,100 after AI-drafted research put false citations in a court brief

The problem

Lawyers for the plaintiff in Lacey v. State Farm, an insurance case in a US federal court, had to file a supplemental brief on whether a judge should review disputed documents in private. Two firms shared the work: Ellis George and K&L Gates.

What they built

A lawyer at Ellis George used several AI tools to produce an outline for the brief. The declaration quoted by the ABA Journal names generative AI features in CoCounsel, Westlaw Precision and Google Gemini. The outline held the legal research and was passed to K&L Gates, whose lawyers worked it into the final brief.

How they did it

No one at either firm checked the research before the brief was filed. The K&L Gates lawyers did not know AI had been used, and did not ask. When the special master, Michael Wilner, found two bad citations and asked about them, the firm sent a revised brief that removed those two but kept other AI-generated errors. It did not disclose the use of AI. The use came out only after a later order to show cause.

Results

The special master found approximately nine of the 27 citations in the 10-page brief incorrect in some way, and at least two authorities did not exist. He called it "a collective debacle" and ordered the two firms to pay $31,100 jointly. He struck the brief and refused the discovery relief it sought. He did not sanction the individual lawyers.

What went wrong

The mistakes came in three steps: AI research used without disclosure, no check of the citations, and a revised brief that hid the real cause. The special master said the AI use had misled him, and that strong deterrence was needed.