Missouri Businessman Fined for False AI-Created Case Citations

A Missouri business owner must pay $10,000 in sanctions for writing legal briefs containing almost two dozen fake case citations generated by artificial intelligence, a state appeals court ruled.

The decision is the latest dealing with AI-generated “hallucinations” in a court filings, as the popular technology is increasingly adopted by the legal industry.

A three-judge panel for the Eastern District of the Missouri Court of Appeals determined that Jonathan Karlen, a business owner representing himself in an unpaid wages lawsuit in a state trial court, cited only two genuine legal precedents out of the 24 citations in his appeals brief.

“We regret that Appellant has given us our first opportunity to consider the impact of fictitious cases being submitted to our Court, an issue which has gained national attention in the rising availability of generative A.I.,” presiding Judge Kurt S. Odenwald wrote in the unanimous opinion filed Tuesday.

The panel said that all parties practicing before the court, including those without attorney representation, should be aware that the court is examining AI and “will not permit fraud on this Court in violation of our rules.”

After submitting the brief with fictitious citations, Karlen apologized to the court and explained that he hired an online consultant who purported to be a licensed attorney in California to prepare his brief.

Karlen said he didn’t know the consultant would use “artificial intelligence hallucinations” in creating the brief.

The sanction comes after a number of similar high-profile cases in Manhattan federal court where attorneys submitted briefs containing fake citations generated by ChatGPT.

Judges Michael E. Gardne and Renée D. Hardin-Tammons also sat on the panel.