From In re Martin, decided yesterday by Bankruptcy Judge Michael Slade (N.D. Ill.):
While I appreciate Mr. Nield's and Semrad's remorse and candor [in their response to my order to show cause], I find that they both violated Federal Rule of Bankruptcy Procedure 9011 [by] {filing a brief containing fake quotations and nonexistent authority manufactured by artificial intelligence}. I further find that a modest, joint-and-several sanction of $5,500, paid to the Clerk of the Bankruptcy Court, along with a requirement that Mr. Nield and another senior Semrad attorney attend an upcoming course on the dangers of AI scheduled for the National Conference of Bankruptcy Judges (NCBJ) annual meeting in September, is the least harsh sanction that will appropriately address counsel's conduct and deter future, similar misconduct from them and others….
The first reason I issue sanctions stems from Mr. Nield's claim of ignorance—he asserts he didn't know the use of AI in general and ChatGPT in particular could result in citations to fake cases. Mr. Nield disputes the court's statement in Wadsworth v. Walmart Inc. (D. Wyo. 2025) that it is "well-known in the legal community that AI resources generate fake cases." Indeed, Mr. Nield aggressively chides that assertion, positing that "in making that statement, the Wadsworth court cited no study, law school journal article, survey of attorneys, or any source to support this blanket conclusion."
I find Mr. Nield's position troubling. At this point, to be blunt, any lawyer unaware that using generative AI platforms to do legal research is playing with fire is living in a cloud. This has been a hot topic in the legal profession since at least 2023, exemplified by the fact that Chief Justice John G. Roberts, Jr. devoted his 2023 annual Year-End Report on the Federal Judiciary (in which he "speak[s] to a major issue relevant to the whole federal court system," Report at 2) to the risks of using AI in the legal profession, including hallucinated case citations.6 To put it mildly, "[t]he use of non-existent case citations and fake legal authority generated by artificial intelligence programs has been the topic of many published legal opinions and scholarly articles as of late."7 At this point there are many published cases on the issue—while only a sampling are cited in this opinion, all but one were issued before June 2, 2025, when Mr. Nield filed the offending reply. See, e.g., Jaclyn Diaz, A Recent High-Profile Case of AI Hallucination Serves as a Stark Warning, NPR Illinois (July 10, 2025, 12:49 PM) ("There have been a host of high-profile cases where the use of generative AI has gone wrong for lawyers and others filing legal cases …. It has become a familiar trend in courtrooms across the U.S."). The Sedona Conference wrote on the topic in 2023. Newspapers, magazines, and other well-known online sources have been publicizing the problem for at least two years. And on January 1, 2025, the Illinois Supreme Court issued a "Supreme Court Policy on Artificial Intelligence" requiring practitioners in this state to "thoroughly review" any content generated by AI.
