Media headlines like this are becoming routine.  So much so that soon they may not even be headline-worthy.  The dog is starting the bite the man.  But I address Lacey v. State Farm Gen. Ins. Co., 2025 U.S. Dist. Lexis 90370 (C.D. Calif. May 5, 2025) here as the issue arose in an insurance coverage case. 

That these situations even arise in the first place is something that I can’t get my head around.  But the conduct in Lacy went a step further.  Even after the court brought the AI-generated fake cites and quotations to the lawyers’ attention, their response, remarkably, made a bad situation worse.  To me, that’s the real take-away – and lesson -- from this unfortunate situation   

This is one of those cases where the lessons to be learned are best achieved by reading the actual opinion and hearing it from the judicial horse’s mouth.  It’s a very lengthy opinion, but most of it has nothing to do with the artificial intelligence issue.  That aspect is addressed at the beginning and end.

https://digitalcommons.law.scu.edu/cgi/viewcontent.cgi?article=3920&context=historical