Attorney Hit With Historic Fine for Citing AI-Generated Cases

An Oregon Court of Appeals panel has issued a historic $10,000 fine to Salem attorney Bill Ghiorso for submitting a legal brief riddled with AI-generated fabrications. The brief contained 15 completely fake case citations and nine fabricated legal quotes, which the attorney initially blamed on a paralegal. According to the judges' order, Ghiorso's office attempted to fact-check the hallucinations by asking Google's AI search engine if the cases were real, which incorrectly affirmed their authenticity. The panel noted this demonstrates a critical misunderstanding: generative AI tools are not reliable fact-checkers, and simple prompts like "don't hallucinate" are ineffective safeguards.

The three-judge panel established a clear penalty framework: $500 for each fake citation and $1,000 for each false quotation or statement of law. Applying this formula, Ghiorso's original penalty was $16,500, but the judges showed leniency by capping it at $10,000. In their ruling, the judges emphasized that submitting an unchecked brief "may breach an attorney's duties of professionalism, truthfulness, and candor to the court." This case follows a December 2025 ruling where the same court first fined an attorney for the practice, and a separate $500 fine was issued in Oregon last month for a single fake citation.

This ruling represents a significant escalation in judicial response to AI hallucination in legal filings. While many attorneys have received warnings, this case sets a precedent for substantial monetary sanctions. It serves as a stark warning to legal professionals about the non-delegable duty to verify all sources, regardless of the tool used for initial research. The judges' detailed penalty structure now provides a blueprint for other courts to follow when confronting similar AI-generated fabrications.