Wall Street law firm Sullivan & Cromwell LLP has been forced to apologise for a series of AI hallucinations, causing ‘inaccuracies and errors’ in a motion filed at the US Bankruptcy Court related to a bankruptcy restructuring case where the firm was representing the joint liquidators for Prince Global Holdings Limited.

The firm admitted internal policies on the use of AI were not followed in the preparation of the motion, stating it included ‘inaccurate citations and other errors’.

The legal team working on the case used AI tools when preparing submissions which resulted in AI hallucinations appearing in the court papers. These types of hallucinations create fabricated case citations, misquoted authorities, and the generation of non-existent legal sources.