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Good morning. A lawyer who used ChatGPT to write a brief – and ended up citing six made-up cases – is facing sanctions, highlighting the question of how ethics rules apply to the new world of AI. Plus, the 2nd Circuit gives the OK to protections for the Sackler family included in Purdue Pharma’s bankruptcy plan, and Delta Airlines faces a lawsuit accusing the company of misleading customers when it calls itself “carbon neutral.” Let’s get to it.
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REUTERS/Dado Ruvic/Illustration
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It’s a scenario legal ethics experts have warned about since ChatGPT burst onto the scene in November: A New York lawyer is facing sanctions after he used the AI program to draft a brief and ended up citing six non-existent court opinions.
What are the rules of using this new technology for legal work? The ABA’s Model Rules of Professional Conduct do not explicitly address artificial intelligence – but several existing ethics rules apply, experts told reporter Karen Sloan.
Those rules are likely to come into play when Steven Schwartz of Levidow, Levidow & Oberman undergoes a sanctions hearing after he admitted to using ChatGPT for a brief in his client’s personal injury case against Avianca Airlines. Schwartz, who did not respond to a request for comment, said in a court filing that he was “unaware of the possibility that its contents could be false.”
Does that matter? “You are ultimately responsible for the representations you make,” said Daniel Martin Katz, a professor at Chicago-Kent College of Law who teaches professional responsibility and studies artificial intelligence in the law. “It’s your bar card.”
Read more about how the rules apply to AI.
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- Darrel Papillion, a trial lawyer in Baton Rouge at Walters, Papillion, Thomas, Cullens, was confirmed to serve on the Eastern District of Louisiana federal bench in a vote of 59 – 31. The Biden White House nominated the former president of the Louisiana State Bar Association in March. (Reuters)
- Evan Greebel lost his U.S. Supreme Court bid to curb the ability of prosecutors to take funds from two of his law firm retirement accounts to satisfy a judgment that he pay back more than $10 million to victims in a fraud scheme that involved former pharmaceutical industry executive Martin Shkreli. The justices without comment turned down a petition from Greebel’s lawyers at Gibson Dunn. (Reuters)
- The California Supreme Court disbarred a San Diego lawyer who is wanted for arrest on charges that she stole from her clients. The state bar of California alleged Kelly DuFord Williams took more than $80,000 in settlement funds that belonged to two clients of her former law firm, Slate Law Group. (Reuters)
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A pro-business trade group has devised an unusual new tactic to try to squelch progressive shareholder activism on issues like diversity, climate change, gun control and abortion. The National Association of Manufacturers intervened in a 5th Circuit appeal by the National Center for Public Policy Research, which bills itself as a conservative counterweight to liberal shareholder activists. The National Center wants the appellate court to reverse a SEC holding that supermarket chain Kroger can exclude its proposal addressing the company’s antidiscrimination policies from shareholder proxy materials. But NAM, writes Alison Frankel, argues that the SEC has no authority at all to force companies to include policy-oriented shareholder proposals in corporate proxy filings — and that by allowing shareholders to muscle their proposals into proxies, the SEC is violating the First Amendment.
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“Absent direction from Congress — and, since 1994, there has been none — or the High Court, the answer is a function of geography.“
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- Three men are set to face trial in Brooklyn federal court on charges of acting as illegal agents of China, part of an escalating crackdown on what U.S. prosecutors call Chinese state-backed intimidation of dissidents and fugitives overseas, Luc Cohen writes. The defendants, according to prosecutors, pressured a New Jersey resident to return to China to face bribery and embezzlement charges, one example of what they describe as a global repatriation campaign by Chinese law enforcement known as “Operation Fox Hunt.” All three men have pleaded not guilty to charges of acting as Chinese agents.
- A 7th Circuit panel will take up an appeal from Wisconsin Democratic Governor Tony Evers to revive a court sanctions bid against Donald Trump ally Sidney Powell. Lawyers for Evers appealed an order from a federal judge who declined to sanction Powell, an attorney who pursued claims challenging Joe Biden’s 2020 presidential election win. U.S. District Judge Pamela Pepper ruled that sanctions would not be appropriate because she had quickly dismissed Powell’s lawsuit before delving into the merits. Michigan’s attorney grievance committee recently filed an ethics case against Powell and several others. Powell has disputed shirking attorney ethics obligations and court rules.
- U.S. District Judge Thomas Barber will hear arguments from attorneys for the FDA urging him to stay part of a lawsuit filed by the state of Florida accusing the agency of being slow to approve a state program to import prescription drugs from Canada. The FDA argues it needs the stay because Florida’s plans to alter the program are making it hard to proceed with the approval process.
- In Pittsburgh federal court, jurors will hear from the prosecution in the case against the man accused of killing 11 worshippers at a Pittsburgh synagogue five years ago in the deadliest antisemitic attack in U.S. history. Robert Bowers is on trial on dozens of federal charges, including 11 counts of hate crimes resulting in death, over the mass shooting that unfolded at Pittsburgh’s Tree of Life synagogue on Oct. 27, 2018. He has pleaded not guilty. He could face the death penalty if found guilty in a federal trial that opened on Tuesday.
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Court calendars are subject to last-minute docket changes.
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- Prosecutors shot back after FTX founder Sam Bankman-Fried urged a federal judge to throw out most of the charges against him, arguing Bankman-Fried’s “alleged misconduct falls within the heartland of what these statutes prohibit.” SBF, who has pleaded not guilty to 13 counts of fraud, conspiracy, making illegal campaign contributions and foreign bribery, has argued that he was charged in a “rush to judgment” after the collapse of FTX and several other crypto businesses. (Reuters)
- The U.S. Supreme Court turned away a patent dispute between labeling company Avery Dennison and ADASA Inc that would have given the court a chance to clarify a standard that critics say has sown confusion about what inventions can be legally protected and has led to cancellations of valid patents. The high court left in place the Federal Circuit’s ruling that ADASA’s patent was valid, rejecting Avery Dennison’s argument that it covered a patent-ineligible abstract idea. (Reuters)
- Lawyers at Hausfeld and other firms said they would seek about $16 million in fees as part of $48 million in settlement agreements with Cox Media, Fox and CBS to resolve advertising price-fixing claims. The broadcasters denied liability. The settlements require cooperation with other media industry defendants that have not exited the litigation in Chicago federal court. (Reuters)
- Ishan Wahi, a former product manager for Coinbase Global, and his brother Nikhil have agreed to settle SEC civil charges that they engaged in a scheme to trade ahead of multiple announcements regarding at least nine crypto asset securities that would be made available on Coinbase’s platform. The pair was sentenced to prison after pleading guilty to related criminal charges. (Reuters)
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- Paul Hastings hired partner Susan Leader in the firm’s Century City office in Los Angeles. Leader previously was co-chair of the complex litigation practice at Wilson Sonsini. (Reuters)
- Weil Gotshal brought on energy and infrastructure dealmaker Chris Bennett as a Houston-based partner from Simpson Thacher. (Reuters)
- Akin added partner Tarun Warriar to its special situations and private credit team in Hong Kong. Warriar previously was a managing director at global investment firm Varde Partners. (Reuters)
- Gibson Dunn added New York-based partner Joseph Zujkowski, who focuses on business restructuring and reorganization. Zujkowski was previously co-chair of O’Melveny’s U.S. restructuring group. (Gibson Dunn)
- Venable brought on corporate partner Jay Gavigan in the firm’s New York office from Morrison & Foerster. (Venable)
- Baker Donelson brought on Ferdose al-Taie as a shareholder in Houston focused on government enforcement and investigations. She was previously at Akerman. (Baker Donelson)
- Armstrong Teasdale added partner Nicholas Leale in London to lead the firm’s U.K. regulatory practice. Leale was previously at Blake Morgan. (Armstrong Teasdale)
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