Levidow, Levidow and Oberman (law firm)
$5,000 fine, case dismissed, public sanction
Attorney Steven Schwartz used ChatGPT to research legal precedents for a personal injury case. ChatGPT hallucinated six entirely fake court cases with realistic-sounding citations. Schwartz filed them in federal court without verifying. The judge discovered all six were fabricated. The case was dismissed and both attorneys were publicly sanctioned and fined $5,000. The case is now a nationwide warning to the legal profession.
Scout fix
output validation flags hallucinated citations before they leave the agent workflow
Sources: Mata v. Avianca, Inc. (Wikipedia)