Flowz Digital LLC v. Dalal
U.S. District Court, Central District of California · C.D. Cal. · California bar guidance
Verified October 1, 2026
- Citation
- Flowz Digital LLC v. Dalal, No. 2:25-cv-00709-SB-PVC, ECF No. 35 (C.D. Cal. May 30, 2025) (order imposing sanctions); see also order to show cause (C.D. Cal. May 5, 2025)
- Decided
- May 30, 2025
Summary
Plaintiff's counsel Omid Khalifeh filed an opposition to a motion to dismiss containing citations the court could not reconcile with the cited authority, including a nonexistent decision the court could not locate, Shell Petroleum N.V. v. Republic of Costa Rica, 608 F. Supp. 2d 269 (S.D.N.Y. 2009). After Judge Stanley Blumenfeld, Jr. ordered disclosure, counsel admitted using an AI tool to identify potentially relevant authorities and organize arguments, without filing the AI-use declaration required by the court's Civil Standing Order. Two other cited cases, In re Daou Systems and S.E.C. v. Cross Financial Services, were misrepresented as standing for propositions the decisions did not support.
- AI tool:
- Unspecified generative AI
- Sanction amount:
- $3,500
What sanction did the court impose?
After a May 5, 2025 order to show cause, the court on May 30, 2025 sanctioned Plaintiff's counsel Omid Khalifeh $3,500, payable to the Clerk, under Rules 16(f) and 11. Rule 16(f) covered his failure to disclose AI use as the court's Civil Standing Order requires. Rule 11 covered citations of dubious relevance and a fictitious case, Shell Petroleum, which he did not acknowledge when first questioned. Counsel was also ordered to notify the California State Bar of the sanction (ECF No. 35).
Why does Flowz Digital LLC v. Dalal matter for law firms using AI?
Flowz Digital illustrates how a judge’s standing order on AI disclosure can convert a routine briefing into a sanctions inquiry. The court flagged not just a fabricated citation but two real decisions cited for propositions they did not support, a failure mode AI-assisted research produces with some regularity. For firms whose litigators practice in C.D. Cal. or other districts with AI standing orders, the case underscores that the disclosure obligation is independent of, and runs parallel to, Rule 11’s verification duty.
Sources
Primary sources
Further reading
Source PDF is a Westlaw printout mirrored from the Damien Charlotin hallucination database. We are working to add the underlying court docket (PACER, CourtListener, or court website) as a second source.
- Charlotin lists the AI tool as Lexis+ AI; the court's order does not name a specific tool, describing only 'an AI tool' used in early drafting.