Tercero v. Sacramento Logistics, LLC
U.S. District Court, Eastern District of California · E.D. Cal. · California bar guidance
Verified April 26, 2026
- Citation
- Tercero v. Sacramento Logistics, LLC, No. 2:24-cv-00953-DC-JDP (E.D. Cal. Sept. 9, 2025)
- Decided
- September 9, 2025
Summary
Plaintiff's counsel Sepideh Ardestani filed a motion for reconsideration containing nonexistent case citations, including a fabricated Seventh Circuit opinion, and a quotation attributed to In re Loudermilch that does not appear in that decision. When opposing counsel flagged the citations, Ardestani denied using AI and continued to defend the citations. District Judge Dena M. Coggins found the conduct "akin to contempt of court" and imposed sanctions after repeated opportunities for counsel to come clean.
- AI tool:
- Unspecified generative AI
- Sanction amount:
- $1,500
What sanction did the court impose?
$1,500 monetary sanction payable to the Clerk of the Court within 10 days. The court ordered the order served on Ardestani's client and directed the Clerk to serve a copy on the State Bar of California.
Why does Tercero v. Sacramento Logistics, LLC matter for law firms using AI?
Tercero illustrates how courts treat denial as an aggravating factor rather than a defense. Counsel was given multiple chances to acknowledge the fabricated citations and instead doubled down, which moved the court from a likely admonition to a formal sanction, client notice, and State Bar referral. For managing partners, the operative lesson is procedural: a firm policy that requires immediate disclosure when a citation cannot be verified is materially cheaper than litigating the cover-up.
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.