June 1, 2026 (in 3 days): New York: 22 NYCRR Part 161 takes effect, system-wide AI policy for all UCS courts →

Mintvest Capital, LTD v. NYDIG Trust Company

U.S. District Court, District of Puerto Rico · D.P.R.

Court sanction

Verified May 14, 2026

Citation
Mintvest Capital, LTD v. NYDIG Trust Co., No. 3:25-cv-01019-FAB-MEL (D.P.R. June 23, 2025) (Lopez, Mag. J., Report and Recommendation)
Decided
June 23, 2025

Summary

Plaintiff's counsel in this commercial dispute filed a tendered reply and a motion to compel containing numerous fabricated case citations, quotations that do not appear in the cited cases, and citations to cases that do not support the propositions for which they were offered. At a show-cause hearing, counsel admitted that many of the errors, including several non-existent cases, were due to the use of Anthropic's AI platform Claude and insufficient verification. As one example, counsel cited "Rodriguez-Lebron v. Negociado de Seguridad de Empleo, 394 F. Supp. 2d 393"; that reporter location actually leads to a different, real decision (Diaz Rodriguez v. Torres Martir, 394 F. Supp. 2d 389), and the cited case does not exist. Magistrate Judge Marcos E. Lopez issued a Report and Recommendation recommending that Rule 11 sanctions be imposed on plaintiff's counsel.

AI tool:
Claude
Sanction amount:
Opposing counsel's fees (amount not yet quantified)
This case summary is informational only. Verify the underlying opinion or order against the primary source before relying on it in any filing or client matter.

What sanction did the court impose?

The Report and Recommendation recommends that plaintiff's counsel be ordered to pay the attorney's fees Defendants incurred in relation to the offending filings (ECF Nos. 64 and 65), or, in the alternative, a monetary sanction. The dollar amount was to be determined on a subsequent fee submission and is not stated as a fixed sum in the June 23, 2025 Report and Recommendation itself.

Why does Mintvest Capital, LTD v. NYDIG Trust Company matter for law firms using AI?

Mintvest is one of a small but growing set of sanctions orders that name a specific commercial AI assistant, here Anthropic’s Claude, rather than treating the tool as generic generative AI. For managing partners, the case underscores that fee-shifting is now a routine remedy when fabricated citations force opposing counsel to chase phantom cases, regardless of which model produced them.

Related on this site

Topic guides

  • Supervised AI Use: ABA Model Rule 5.1, Rule 5.3, and the state opinions that translate them into firm-side duties to supervise AI tools and the people using th…

From the blog

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.

Unverified claims:
  • The identity of the sanctioned attorney is not stated in the Report and Recommendation, which refers to her only as 'Plaintiff's counsel.'
  • Exact dollar amount of the recommended fee award (the Report and Recommendation directs payment of opposing counsel's fees but the figure depends on a follow-on fee submission).
  • Whether the district judge ultimately adopted the Report and Recommendation, and the disposition of any objections, is not visible from this document.