AI Regulation Tracker / Court sanctions
An Illinois appellate panel raised the price of an AI-hallucinated citation to $1,500, on purpose
The court said the rate is higher than past practice, said why, and priced a fabricated quote, a nonexistent case and a real case that does not say what counsel claimed at exactly the same figure.
What did the court actually order?
The panel ordered attorney Cole to pay a $15,000 fine to the clerk of the Appellate Court, First District, within 30 days. The arithmetic is on the face of the decision. The briefs contained 10 false citations: 4 false statutory quotations, 1 nonexistent case, and 5 cases that exist but do not contain the cited principle or quoted language. In the court's words, "This sanction reflects a $1,500 fine for each false citation and quotation."
The authority is Illinois Supreme Court Rule 375(a) and (b), the appellate sanctions rule. The opinion also directs the clerk to send a copy to the Attorney Registration and Disciplinary Commission. Two separate consequences, and only the first is final.
Why does a court say it is raising the price on purpose?
Sanctions opinions explain why the conduct was bad. This one explains why the number was chosen, which is rarer and more useful.
The panel acknowledged the departure, writing that "this rate is somewhat higher than what courts have imposed in the past." False citations keep appearing despite a growing pile of sanctions orders, which the court read as evidence that "the fines courts are imposing are not enough to deter improper AI use among attorneys." The conclusion it drew is the sentence that will travel furthest.
Courts have no choice but to increase fines for AI-hallucinated citations until those fines have a significant deterrent effect.Scott v. Illinois Human Rights Commission, 2026 IL App (1st) 251462, para 58
Read that as a pricing signal, not a one-off punishment. A court has told the bar in a published opinion that the going rate is on an upward path by design. Nobody outside Illinois is bound by the figure. The reasoning still travels, because the deterrence problem is not a local one.
Why are a fake quote, a fake case and a real case that does not help all worth $1,500?
Coverage of AI sanctions fixates on the invented case, the citation to a decision no reporter ever published. That is the vivid failure. It is also the easiest to catch.
The panel refused to grade on that curve. Of the 10 false citations, only one was a nonexistent case. Four were false statutory quotations, meaning the statute is real and the words attributed to it are not. Five were real cases that do not contain the principle or the language counsel attributed to them. All 10 were priced identically at $1,500.
The logic is set out in the same paragraph that rejects the AI excuse. The court reasoned that "AI-hallucinated citations are no different than false citations an attorney could create from his own imagination," and therefore "the sanctions rate for all types of false citations and quotations should be the same, as the attorney, not AI, retains ultimate responsibility for what he or she submits to the court."
Follow that through to the review process. A firm whose citation check only confirms that each cited case exists has built a control for the least common of the three failures here. The expensive category, five of the ten, was cases that pull up cleanly in any database and simply do not say the thing. Only reading them catches that.
How does this rate compare with what other courts have charged?
The opinion situates itself against earlier sanctions figures. Those comparison points are the court's own citations of what other benches have done, not part of what this panel held.
| Court | Amount | Basis | Disciplinary referral |
|---|---|---|---|
| Appellate Court of Illinois, First District (this decision) | $1,500 per false citation or quotation; $15,000 total on 10 items | Ill. S. Ct. R. 375(a) and (b); holding of this panel | Yes. Clerk ordered to send the opinion to the ARDC |
| Earlier Illinois practice | $1,000 flat | Prior practice the panel says it is departing from | Not stated in this opinion |
| Couvrette | $1,000 and $500, split by category of citation | Earlier approach the panel declined to follow, which priced categories differently | Not stated in this opinion |
| Cook County circuit court | $59,500 | Another court's prior sanction, cited here for context only | Not stated in this opinion |
| United States Court of Appeals for the Seventh Circuit | $5,000 | Another court's prior sanction, cited here for context only | Not stated in this opinion |
Only the first row is this court's holding. The Cook County and Seventh Circuit figures are sanctions imposed by other courts, cited by the Illinois panel as background. Neither was imposed in this case.
The table shows the shape of the change better than the headline number does. A flat $1,000 becoming $1,500 is a 50 percent increase on the unit price. Dropping the split rate is the larger move, because it reprices the cheapest category of error, the real case that does not support the proposition, at the top rate.
Does paying for an enterprise AI subscription change the duty?
Counsel's response stated that he uses a "premier corporate subscription of ChatGPT" to draft filings. The panel treated that as an aggravating detail, and its answer is the line worth circulating inside a firm.
No matter how much one pays for "premier" or "corporate" versions of AI products, it does not negate an attorney's obligation to verify all citations of authority.Scott v. Illinois Human Rights Commission, 2026 IL App (1st) 251462, para 57
Procurement teams should sit with that. Enterprise AI contracts are sold on assurances about grounding, retrieval and reduced hallucination, and those features can be real. What a vendor cannot sell is a transfer of the verification duty. A better subscription may reduce how often a false citation is generated. It does not change who pays $1,500 when one gets filed.
The same paragraph disposes of the underlying excuse. The fact that AI hallucinated the citations "does not mitigate their falsehood." Narrow words, wide reach, because they foreclose the argument most commonly offered in these matters: the lawyer was misled by a tool.
What follows the fine, and what does not?
Two things happen. The fine is due within 30 days. Separately, the clerk sends a copy of the opinion to the ARDC.
The referral deserves precision, because it is easy to over-read. A referral opens a channel. It is not a finding. The commission decides on its own whether to investigate and what to conclude, and nothing in the opinion determines that. Treating the referral as a suspension, or as a disciplinary result of any kind, reports something the opinion does not say.
The referral is also the structural difference between this case and the matters involving self-represented litigants. Courts confronting pro se filers with fabricated citations have split on the response, partly because a self-represented litigant sits outside the professional conduct rules, so there is no disciplinary body to refer them to. An admitted attorney sits inside those rules. The referral follows, and the fine is only the visible half of the exposure.
What should a litigator outside Illinois take from this?
You are not bound by a First District sanctions figure. You are operating in a market where the price of this error is being marked up in public by judges who are telling each other to mark it up further. Three things follow for a firm setting policy.
- Change what your citation check verifies. Existence checking is the easy control and it caught one of the ten items here. Someone has to read the cited passage and confirm it says what the brief says.
- Stop treating the AI-drafted brief as a different category from the associate-drafted brief. A review process that applies looser scrutiny to machine output is calibrated backwards.
- Keep the subscription tier out of the risk conversation. It has been rejected in a published opinion, and repeating it in your own filing invites the same treatment.
The augmentation framing still holds. Drafting assistance is useful and this opinion does not say otherwise. It says the judgment step, where a human confirms that an authority exists and supports the proposition, cannot be handed to the thing that produced the draft. That is not a technology position. It is about who the rule holds responsible.
Frequently asked questions
How much was the fine and what was it for?
The Illinois Appellate Court, First District, ordered attorney Cole to pay a $15,000 fine to the clerk of the court within 30 days of the opinion filed July 28, 2026. The briefs contained 10 false citations: 4 false statutory quotations, 1 nonexistent case, and 5 cases that exist but do not say what was claimed. The rate was $1,500 for each, under Illinois Supreme Court Rule 375(a) and (b).
Is $1,500 per citation now the standard across Illinois?
No. This is one appellate panel exercising its sanctions power under Illinois Supreme Court Rule 375 in a single case. It is not a rule amendment and sets no fixed statewide tariff. It is a published First District opinion, so it carries precedential weight, and the panel stated that the rate is higher than past practice and that courts must keep increasing fines until they deter.
Does a paid enterprise AI subscription reduce the duty to verify citations?
The opinion rejects that argument in terms. Counsel stated that he used a premier corporate subscription of ChatGPT to draft filings. The court answered that no matter how much one pays for premier or corporate versions of AI products, it does not negate an attorney's obligation to verify all citations of authority.
Does the referral to the ARDC mean the attorney has been disciplined?
No. The opinion directs the clerk of the Appellate Court, First District, to send a copy to the Attorney Registration and Disciplinary Commission. That is a referral, not a disciplinary outcome. Whether the ARDC opens a matter, and what it concludes, is a separate process from the fine.
Last verified: July 28, 2026