Mundy v. Clickstop, Inc.
District Court of Nebraska, Douglas County · Neb. Dist. Ct. (Douglas Cnty.) · Nebraska bar guidance
Verified September 29, 2026
- Citation
- Mundy v. Clickstop, Inc., No. CI 23-6600, 2025 WL 3073933 (Neb. Dist. Ct. Douglas Cnty. Oct. 17, 2025)
- Decided
- October 17, 2025
Summary
Plaintiffs' counsel James E. Harris filed five briefs on July 28, 2025, including a combined spoliation motion and summary-judgment opposition, that, as the court's order details, cited authority that does not appear to exist, including "Hogan v. Norfleet, 191 Neb. 123," "Schiavone Construction Co. v. Time Equipment Rental, Inc., 205 Neb. 442," and "Panhandle Coop. Ass'n v. Whirlpool Corp., 250 Neb. 667," and attributed to Rahmig v. Mosley Mach. Co. a direct quotation that "does not exist in the provided case." Defense counsel raised the problems in an August 1 reply brief and at the August 4 hearing. At the show-cause hearing Harris stated he had used generative AI in his filings, and his written response to the order to show cause, which he said he prepared with AI and manually verified "to the best of his ability," contained a Restatement (Third) of Torts quotation that the court said "appears to be hallucinated." Judge James M. Masteller found Harris did not knowingly include false statements of law but that his conduct "was tantamount to bad faith."
- AI tool:
- Unspecified generative AI (counsel "stated he had utilized generative artificial intelligence (“AI”) in his court filings")
- Sanction amount:
- $2,000
What sanction did the court impose?
Treating the matter as a hybrid of direct and indirect contempt, the court struck plaintiffs' motions filed on or after July 28, 2025 that had not yet been ruled on, and the related briefs, with leave to refile; required all pleadings, motions, and briefs Harris files in the case to certify either that no generative AI was used or that he manually verified all generated text; fined Harris $2,000, payable to the Clerk of the District Court by November 25, 2025; and directed that a copy of the order be forwarded to the Counsel for Discipline for review and investigation.
Why does Mundy v. Clickstop, Inc. matter for law firms using AI?
Mundy shows how a court can find conduct “tantamount to bad faith” without finding intent. Judge Masteller found that counsel “did not knowingly or intentionally include false statements of law,” was “sincerely remorseful,” and had told the court he had attended several trainings on AI. The court found that counsel “understood the necessity for such verification as he is knowledgeable regarding the potential risks associated with the use of AI in the preparation of court filings.” It also found that his written response to the order to show cause, prepared with AI and, he said, manually verified, contained another quotation that “appears to be hallucinated.”
The order combines four measures: striking the affected filings with leave to refile, a certification requirement for all pleadings, motions, and briefs the same attorney files in the case, a $2,000 fine, and a report to the Counsel for Discipline. Firms documenting their AI review practices may wish to note the certification’s wording: a filing must state either that “no generative artificial intelligence program was used” or that counsel “manually verified the accuracy of all generated text, including all citations, quotations, and legal authority.”
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.
- The cited copy is a third-party tracker's mirror of the Westlaw reprint of the Order for Sanctions (2025 WL 3073933). No court-hosted copy is reachable: Nebraska district-court documents are available only through the paid JUSTICE subscription service.