What just happened? Two lawyers and their law firm have been fined $5,000 by a district judge in Manhattan for citing fake legal research generated by ChatGPT. In a written opinion, Judge P. Kevin Castel chided attorneys Steven Schwartz and Peter LoDuca for failing to do due diligence before submitting their filing and abandoning their legal responsibilities as officers of the court when they submitted "nonexistent judicial opinions with fake quotes and citations."

The ruling came a month after attorney Steven A. Schwartz admitted to submitting fake legal research generated by ChatGPT in a personal injury case against Colombian airline Avianca. Schwartz's citation referenced several cases similar to the one he was fighting, but none of the cases he cited were actually real. As it turned out, ChatGPT fabricated them all with the sole purpose of supporting Schwartz's submission.

When confronted with the error by Judge Castel, Schwartz admitted that it was the first time he was using ChatGPT for research and had no idea that the content could be false. He also apologized for the mix-up and claimed he had no intention of deceiving the court. He further claimed that he had attempted to verify the authenticity of the citations by asking ChatGPT if the cases were real, and got an affirmative response from the chatbot.

In his ruling against the two attorneys and their law firm Levidow, Levidow & Oberman, Judge Castel said that there's nothing "inherently improper" about using artificial intelligence in legal scenarios. However, it is incumbent upon the lawyers to ensure that their filings are factually accurate. The judge also took exception to the fact that Schwartz seemingly stood by the fake opinions even after lawyers for Avianca alerted the court that there's no record of any of the cases cited in the filing.

Following the ruling from the Manhattan district court, Levidow, Levidow & Oberman released a statement, saying it "respectfully" disagreed with the court's decision. "We made a good-faith mistake in failing to believe that a piece of technology could be making up cases out of whole cloth," it said. Schwartz and his lawyers declined to comment on the ruling, while LoDuca did not respond to Reuters' request for a comment.

On the other hand, lawyers for Avianca applauded the court's decision to impose the fine and dismiss the personal injury case. It is worth noting that the dismissal had nothing to do with the fake citations, but was done because the case was filed too late.