TL;DR

Two recent federal court orders — Miller v. Regions Bank (N.D. Ala. May 21, 2026) and Couvrette v. Wisnovsky (D. Or. Dec. 12, 2025, with follow-on order Mar. 23, 2026) — show that the worst-case outcome of AI use is rarely the hallucination itself. It is the lawyer's response after the hallucination is caught. Both courts say plainly to the attorney-offenders 'own the mistake or lose your case, your bar standing, or both.' This article walks through the two orders, then gives firms 7 Best Practices to put in place in your firm.

The Cover-Up -- Miller v. Regions Bank

On November 26, 2025, a solo practitioner in Alabama named H. Gregory Harp signed up for a paid ChatGPT Plus subscription. Four days later, he filed an opposition to summary judgment in Miller v. Regions Bank, No. 2:24-cv-1324-HDM (N.D. Ala.). The brief contained four quotations attributed to real Eleventh Circuit and D.C. Circuit decisions. The cases were real. The quotations were not.

U.S. District Judge Harold D. Mooty III pulled the proverbial thread. With falsity now exposed, he issued a show-cause order on the four false quotations and ordered Harp to either produce the underlying authorities with the quotations highlighted, or submit a sworn declaration explaining how the brief was generated.

Harp's first response he had not used AI.

At the April 20, 2026 show-cause hearing, that story changed a bit. Harp now said he used ChatGPT "to do a general search," but no AI "wrote a single word" of the brief. Pressed, he conceded the quotations "could have been generated by ChatGPT" — but he had not checked his ChatGPT history. He volunteered, on the record, to pull the log.

The court took him up on it. The same day, Judge Mooty entered an in camera production order to turn over the screenshots of every ChatGPT conversation related to the case.

Three days later, on April 23, Harp deleted his ChatGPT account. Not just canceled it — he requested a prorated refund, which forfeited his read-only access through the end of the billing cycle on April 30 (one day past the court's production deadline). His later declaration framed the deletion as a contrite, post-hearing decision: "After the hearing I was extremely upset that I had used ChatGPT at all." The OpenAI emails he was forced to produce told a different story.

The Court's view of that framing is worth quoting:

"The court is not ordering the harshest of Attorney Harp's sanctions because he made a mistake. The court is ordering them because, when confronted with that mistake, he chose dishonesty over candor and destruction over disclosure. Lawyers make errors. Competent and ethical lawyers own [their mistakes]."

On May 21, 2026, the court sanctioned Harp under Rule 11, its inherent authority, and Alabama Rule of Professional Conduct 3.3, and held him in civil contempt. The order:

1. Publicly reprimands him, with a publication requirement (he must serve the order on every client, opposing counsel, and judge in his open cases);

2. Disqualifies him from Miller and stays the case for 60 days to let the client find new counsel;

3. Suspends him from practice in the Northern District of Alabama for six months;

4. Refers the matter to the Alabama State Bar; and

5. Draws an adverse inference that ChatGPT generated the fabricated quotations (and likely other misstatements the court flagged), based on the bad-faith spoliation finding.

Critically--and this is the heart of the point I’m trying to make--the Court drew a sharp line between the underlying error and the cover-up. The Rule 11 sanction for the false citations was the public reprimand. The disqualification, suspension, and bar referral were for the cover-up; the lies and the spoliation.

The Skyrocketing Dollar Figure -- Couvrette v. Wisnovsky

If Miller is the cover-up case, Couvrette v. Wisnovsky, No. 1:21-cv-00157-CL (D. Or.), is the volume case — and, as of this writing, the largest AI hallucination penalty in U.S. history.

The underlying lawsuit was a family fight over Valley View Winery in Jacksonville, Oregon. Joanne Couvrette sued her two brothers for control of the family vineyard, alleging elder abuse and seeking roughly $12 million. In early 2024, San Diego attorney Stephen Brigandi appeared pro hac vice for Couvrette. Because he was not licensed in Oregon, Portland landlord-tenant attorney Tim Murphy signed on as local counsel.

Across three briefs related to cross-motions for summary judgment, the plaintiff's filings contained 15 nonexistent cases and ten fabricated quotations. When defense counsel flagged the problems, Brigandi did not concede. Instead, he filed a useless Notice of Errata, without acknowledging the fake cites or quotes. And here’s the funniest part to me — he re-filed without verifying the remaining citations, which themselves continued to misstate the law.

Judge Clarke's opinion is unsparing, showing he had no qualms in terminating a $12.6 million claim:

"In the quickly expanding universe of cases involving sanctions for the misuse of artificial intelligence, this case is a notorious outlier in both degree and volume. ... If there was ever an 'appropriate case' to grant terminating sanctions for the misuse of artificial intelligence, this is it."

The cover-up won the attorneys and their client a sanctions package of approximatey $110,000. Judge Clarke's December 12, 2025 Order, his Order from March 23, 2026 and his Order from March 30, 2026 set forth the sanctions and award of attorneys' fees. It's structured to hit three different people:

Brigandi (pro hac vice counsel)

$80,498.72 in opposing-party attorney fees plus $15,500 in fines. The court also struck the sanctionable briefs without leave to refile.

Murphy (local counsel):

$14,205.66 — 15% of defendants' fees — imposed in the follow-up order of March 23, 2026 for failure to meaningfully supervise pro hac vice counsel.

Couvrette (the client):

The court found she shared responsibility and so her claims of $12.6 million were dismissed with prejudice as terminating sanctions, and the matter was referred to the Oregon State Bar.

The lesson from Judge Clarke matches Judge Mooty's, even though the misconduct profile is different. Clarke wrote, "Plaintiffs and their counsel have not been adequately forthcoming, candid or apologetic about their conduct." And on the attempted fix, "There is no evidence that Mr. Brigandi took any steps to verify the veracity of the legal arguments contained in the amended briefing, which continue to contain misstatements of law."

Three Threads Running Through Both Orders

Read together, Miller and Couvrette point to the same three points of failure — and they are ones I’ve talked about and written about, but they are the ones we aren’t doing a good enough job covering in most CLEs.

1. The Hallucination Is Sanctionable, But The Cover-up? It's Career-Altering.

Both courts went out of their way to separate using an hallucinated case versus covering that fact up. Judge Mooty imposed a public reprimand for the false quotations alone — a serious but survivable sanction. The career-ending sanctions (disqualification, six-month suspension, bar referral) resulted from the deletion and the story that surreptitiously changed. Judge Clarke followed the same logic. The briefs themselves earned fees and fines, but the dismissal with prejudice — "terminating sanctions" — came from the lack of candor and the attempted cover-up.

2. Your Chat History Might Become Evidence Against You.

Here’s another thing we don’t cover nearly enough in CLE’s, bar opinions, or friendly conversations. The moment a court raises an AI question, the lawyer's chat history becomes subject to the same preservation duty as any other electronically stored information. Miller applies the Eleventh Circuit's bad-faith spoliation framework to a ChatGPT account and draws an adverse inference. Practitioners should assume that deleting a chat history after AI use is questioned will be treated, at minimum, as bad-faith spoliation under Rule 37(e)(2) and the court's inherent authority — regardless of jurisdiction. This, of course, immediately causes me to point that the best AI use is based on the most solid Data Governance. But that, of course, is an article or CLE for another day.

3. Local Counsel’s Signature Is Not Just a Pro Forma Requirement.

Murphy showed up and signed the documents. That is a common, routine way for local counsel to make a bit of extra money. It’s essentially been a pro forma act. A rubber stamp. But now after Murphy’s sanction in Couvrette is the death knell for just signing as a matter of course or procedure.

"Procedural" local counsel is a fiction we may be living under, but that’s almost certainly not how it was originally intended. And the court declined to accept it.  This will not be the last case where local counsel is sanctioned for signing a brief with AI-generated falsity.  If you sponsor a pro hac vice admission and sign on as local counsel, you now own a real obligation to supervise because that obligation might be enforced, as it was here, with a loss of tens of thousands of dollars.  I’m curious how much Murphy originally received to act as local counsel.

Best Practices -- 7 Practical Rules Every Firm Should Adopt

None of these require a new platform purchase. And, all can be implemented at a solo or small-firm level.

1. Adopt a written cite-verification SOP. Add to your AI Policy that every AI-assisted brief gets two-person verification. The drafter pulls the underlying authority and highlights the quoted language; a second attorney, paralegal or assistant checks against the source. No filing leaves the firm unless every quotation and every case has been independently confirmed in a primary source. At the very least, go through these suggestions, such as running your final brief through Perplexity and asking it to verify your cites and quotes (no, that is not a substitute for human verification, but it’s better than nothing).

2. Treat your AI chat history as evidence the moment a court raises the issue. It’s good data governance to delete confidential or sensitive chats the minute you are finished with them. But it’s spoliation to do so after a potential problem is raised. Larger firms should route deletion authority through a partner — not the lawyer under inquiry.

3. Add a Clause to Your AI Policy. Decide now, in writing, how the firm responds the first time a court flags a suspect citation. My suggestion is a same-day acknowledgement and apology, a written declaration of how the brief was generated, and full production of AI logs. Both judges in these cases said the response that would have preserved the lawyer's career was contrition and disclosure on day one. And we’ve seen that in other cases.

4. Consider the Quality and Settings of the Tool You are Using. ChatGPT Plus is a consumer product. For client work, use tools with zero-data-retention, tenant isolation, and obtainable audit logs — not because they hallucinate less, but because the audit trail proves you did the verification work when the court asks.

5. Add an AI certification block to every brief. Track the federal trend: 30+ district courts and 300+ individual judges now require some form of AI disclosure or certification. A standing internal form — "AI used: yes/no; tool: ___; verification performed: ___; verifier: ___" — protects the file, satisfies most standing orders, and adds more force behind what should be happening anyway.

6. Change your local-counsel and pro hac vice Agreements. If you are local counsel, write into the engagement what supervision you will actually perform on filings — and price the matter accordingly. If you are visiting counsel, expect (and welcome) a real review, but don’t count on it, unless you are paying local counsel accordingly.

7. Train associates and staff on the candor rule. Many (and I suspect most) AI sanctions cases start with a paralegal or associate cutting a corner under deadline pressure. Train the whole team that the right response to "I think I may have failed to check a cite" is to raise it to a partner the same day. Build double checking all cites into your firm training.

Bottom Line

The AI hallucination problem is now well past its novelty phase. In fact, I’ve stopped feeling so incredulous when I see a new case of fake cites. Courts are moving quickly from "caution" to "escalating consequences." And in my experience there is generally nothing a judge or court hates more than lawyer misconduct and lawyers responding disingenuously to the court. As bad as hallucinations, fake case cites, and fake quotes are, the coverup is always worse.

© 2026 Amy Swaner. All Rights Reserved.  May use with attribution and link to article.