Carter v. UZGlobal LLC
U.S. District Court, District of New Mexico · D.N.M. · New Mexico bar guidance
Conduct
Here the signing attorney filed papers, which plaintiffs said an associate drafted, citing sixteen nonexistent cases, including motions filed after opposing counsel flagged one case as unlocatable.
Consequence
$1,000 fine, self-report to the Texas disciplinary authority, order sent to the New Mexico bar, proof of an AI CLE, fee motion allowed; costs may not be passed to the clients.
Lesson
Here the court treated the opponent's April footnote as notice: filing more unverified briefs after it weighed against the signing attorney.
Verified September 30, 2026
- Citation
- Carter v. UZGlobal LLC, No. 1:23-cv-01013-MV-JHR, Order Imposing Sanctions on Plaintiffs' Counsel for Rule 11 Violation (D.N.M. May 1, 2026) (Ritter, M.J.), ECF No. 275; see also Order to Show Cause (D.N.M. June 27, 2025), ECF No. 101
- Decided
- May 1, 2026
Summary
In an action by Rasheem Carter and the estate of Ervin Burton against UZGlobal LLC d/b/a FastPlus Cargo, Osmany Hanna Roldan, three Amazon entities, and Ryder Truck Rental, plaintiffs' counsel Maxey Scherr signed a March 2025 response to the Amazon Defendants' motion for a protective order and three June 2025 motions to compel. In April 2025 the Amazon Defendants' reply noted that one cited case, Harris v. United States, 204 F.R.D. 560 (D. Colo. 2001), could not be located. Plaintiffs withdrew the motions to compel on June 12, 2025, after another attorney alerted Scherr to a similar issue in a different case, and on June 20, 2025 the parties alerted the court that the filings could contain fake cases. Magistrate Judge Jerry H. Ritter issued two show-cause orders. In response, plaintiffs identified sixteen nonexistent cases across the March response brief and two motions to compel. According to plaintiffs, associate attorney Raquel Aguirre researched and drafted the briefs and Scherr "reviewed these filings for "writing style, argument, etc." but did not verify the cases cited." Plaintiffs said they believed Aguirre used AI but did not know which program, that the firm does not permit AI for legal research and writing, and that Aguirre had been terminated for a separate issue.
- AI tool:
- Unidentified AI program (plaintiffs' counsel believed a now-terminated associate used AI but did not know which program)
- Sanction amount:
- $1,000 fine to the Clerk of Court; self-report to the Texas disciplinary authority and copy of the order to the New Mexico bar; proof of attendance at an AI CLE; Amazon Defendants permitted to move for fees and costs; costs may not be charged to the clients
What sanction did the court impose?
The court found that Scherr violated Fed. R. Civ. P. 11(b) and imposed sanctions under Rule 11(c). It held that "submitting documents with AI-hallucinated cases is objectively unreasonable," that Scherr's signature made her as responsible as if she had written the briefs, and that she "had adequate notice in April to discover her error and avoid filing more fake cases but did not." The court credited that she did not try to avoid responsibility, self-reported to the New Mexico bar, took a CLE, and offered to pay reasonable fees. It ordered her to self-report to the proper disciplinary board for the Texas state bar with the order attached, to submit the order to the New Mexico state bar for her earlier report, to pay a $1,000 fine to the Clerk of Court, and to submit proof of attendance at an AI CLE course (the order cites her response, Doc. 114-1), all within fourteen days. The Amazon Defendants may move for attorney fees and costs for their research on the fake cases and their show-cause responses, with a briefing schedule set under Rule 11. Scherr may not charge the sanctions to her clients or recoup them under any fee agreement.
Why does Carter v. UZGlobal LLC matter for law firms using AI?
Carter is a supervision case. According to plaintiffs, the briefs were researched and drafted by an associate, and the signing attorney reviewed them for “writing style, argument, etc.” without checking the authorities. Magistrate Judge Ritter applied the Tenth Circuit’s objective-reasonableness test and held that the delegation did not matter: “While Ms. Scherr states that another attorney wrote the briefs, her signature pursuant to Rule 11 makes her just responsible as if she had written the briefs herself.” The court added that even without any warning, “an objectively reasonable attorney would have noticed something wrong in these briefs with a cursory review,” pointing to incorrectly formatted citations and a brief resting “almost entirely on out-of-district, out-of-circuit authorities.”
Notice was the aggravating fact. The Amazon Defendants’ April 2025 reply had flagged Harris v. United States as a case counsel could not locate. Scherr told the court she saw the footnote but did not realize it meant the case was fake until another attorney contacted her in June. By then she had filed three more motions to compel. The court found she “had adequate notice in April to discover her error and avoid filing more fake cases but did not,” and that the Amazon Defendants “incurred significant, unnecessary fees addressing the Rule 11 violation.”
The remedy combines modest money with professional reporting. The court credited Scherr’s acceptance of responsibility, her self-report in New Mexico, and a completed CLE, then added a Texas self-report, a $1,000 fine, proof of attendance at an AI CLE course, and a path to a fee award, while forbidding her from passing any of it to the clients. Firms documenting compliance may wish to consider how a partner’s review of associate drafts is recorded, and how an opponent’s “we could not locate this case” is routed for immediate verification.
Implications for your firm
Operational steps a firm reading this case may wish to consider documenting. Strategic and rule-application calls belong to your firm's attorneys.
- Document cite-checking before signature on work drafted by associates. The court held that Scherr's Rule 11 signature made her responsible even though, by plaintiffs' account, another attorney wrote the briefs.
- Review how the firm responds when an opponent says a cited case cannot be located. The court found the April 2025 footnote gave Scherr adequate notice before she filed the June motions to compel.
- Verify that a written no-AI policy is matched by a verification step. Plaintiffs said the firm did not permit AI for research and writing, yet the filings contained sixteen nonexistent cases.
- Consider the reach of the remedy: the court required a self-report to a second state's disciplinary authority and barred passing the sanction costs to the clients.
Sources
Primary sources
- Whether the Amazon Defendants moved for fees and whether any fee award followed was not checked; GovInfo's package for this docket holds no later opinion as of 2026-09-30, and the entry describes only the May 1, 2026 order.
- The AI attribution rests on plaintiffs' own belief as recounted in the order and on Scherr's concession that the cases were 'likely hallucinated by AI'; the order does not identify a tool.