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Courts on AI / Fabricated or misquoted citations

Song Dow Lee v. HSBC Bank USA, National Association

United States District Court for the Central District of California · Federal district courts · CA · · 2026 WL 1270038 · No. CV 26-1198-JFW (Ex) · order

The Central District of California on 2026-05-07 ordered counsel to show cause why sanctions or corrective action should not issue for the defective authorities in Song Dow Lee, et al. v. HSBC Bank USA, National Association, et al. Counsel filed an opposition with one fabricated case citation and one mischaracterized case citation, including Inc. v. Umpqua Holding Corp.

Disposition
The court issued an order to show cause why counsel should not be sanctioned, including possible $2,500 sanctions or dismissal.
Recorded conduct
Plaintiffs’ counsel misrepresented holdings and inserted a nonexistent quotation. The court ordered counsel to show cause whether AI was used and why sanctions or dismissal should not issue. — outcome: pending; actor: lawyer
Canonical record
Incident tracker entry — verified outcome, regulator disposition and related rules

What the court wrote

Verbatim from the court's document (public domain). Ellipses mark omitted text; nothing is paraphrased.

36 at 11, Plaintiffs failed to correct those misrepresentations in their Proposed Statement of Decision filed on April 15, 2026 (Docket No. 39). Accordingly, Plaintiffs' counsel are ordered to show cause, in writing,onorbeforeMay11,2026,whythisCourtshouldnot impose sanctions on counsel in the amount of $2,500. 00 and/ ordismissthisaction. Plaintiffs'counselshallfiledeclarations in support of their response to the order to show cause, which shall address, inter alia, whether artificial intelligence was used to draft Plaintiffs' Opposition and Proposed Statement of Decision, and what actions counsel took to determine that any of the propositions of law relied on by Plaintiffs were accurate. Nooralargumentonthismatterwillbeheardunless otherwise ordered by the Court. See Fed. R. Civ. P.

Authorities cited in the passage: Inc. v. Umpqua Holding Corp., 669 F.Supp.3d 904, 906 (N.D. Cal. 2023).' The court noted the citation/quote did

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