Background
Capital Standard, LLC and related land-trust parties appealed a Pinellas County circuit court’s final declaratory judgment in favor of U.S. Bank National Association, acting as trustee for a Bear Stearns asset-backed securities trust.
During the appeal, Capital Standard’s counsel, Kenneth Keefe, filed briefs containing numerous citations and quotations that did not support the propositions asserted, as well as one nonexistent case. After the court issued an order to show cause identifying forty-six hallucinated authorities, Keefe did not respond for more than a month. The court struck the offending briefs; corrected briefs were later filed and formed the basis for the merits disposition.
The Court’s Holding
The Second District affirmed the declaratory judgment in all respects without further discussion of Capital Standard’s merits arguments.
Separately, the court held that Keefe’s reliance on unverified AI-generated legal material violated Florida’s filing and briefing rules. It imposed a $1,500 fine, ordered Keefe personally to pay U.S. Bank’s reasonable appellate fees incurred researching and answering the defective amended initial brief, and referred him to The Florida Bar. The court remanded for the trial court to determine the amount of the fee award.
Key Takeaways
- An attorney must independently verify that cited authority exists and supports the proposition for which it is offered.
- AI-generated hallucinations in appellate briefs can support fines, fee shifting, struck briefs, and bar discipline.
- The sanctions were imposed on counsel personally; he may not charge his clients for the fine or fee award.
Why It Matters
The decision underscores that generative AI may be used in legal practice only with competent human verification. The court treated false or unsupported citations as a serious breach of counsel’s duties to the court and opposing party, even where some legal propositions may have been valid.