Howard Benjamin told U.S. District Judge Lewis Liman during a hearing in Manhattan court that he should have checked the motion for accuracy and that he withdrew it within 30 minutes of learning of the issue.
Benjamin represents Jason Ader, an investment adviser who was accused along with his asset management firm of fraudulently inducing Virgin Islands-based Rimu Capital Ltd. to invest $25 million in a holding company for his personal profit. Ader sponsored an acquisition company, which entered an agreement with the owners of a casino in the Philippines to take the business public, according to the suit.
Rimu claims Ader induced it to invest in the holding company without disclosing he was the seller, and that Ader used that money to pay back $16 million in interest to his mother, Pamela Ader.
Benjamin filed a motion to dismiss the case on Oct. 15 on Jason Ader's behalf. Rimu attorney Gregory Blue of Lachtman Cohen & Belowich LLP said in a letter later that day that he was unable to locate four cases cited in the motion and another four cases cited in quotations. Blue's letter said the motion "appears to contain fake, AI-hallucinated case citations and quotations."
Asked by Judge Liman to explain Tuesday, Benjamin said Ader gave him "research" that another, unnamed attorney had done. Benjamin said that given the increased use of AI, "which I did not use and never will use," he should have checked the cases.
Judge Liman said he would allow Rimu to file a motion for sanctions and reminded Benjamin that any time an attorney signs papers, that attorney assumes responsibility for their accuracy. Benjamin apologized for the mistake and said he recognized the error.
Benjamin declined to comment beyond his statements in court.
In May, Judge Liman dismissed claims and cross-claims against Pamela Ader, law firm Sadis & Goldberg LLP and two of the firm's partners.
On Oct. 1, a different attorney representing Ader in New York state court in a loan dispute with his mother was sanctioned for submitting a summary judgment brief with AI-hallucinated citations and quotations.
Pamela Ader claims in that suit that Jason Ader defaulted on a $13 million loan he received from his late father for a Manhattan townhouse.
Justice Joel M. Cohen said that the attorney for Jason Ader in that matter, Michael William Charles Fourte, had initially denied that he'd used unvetted AI after the errors in his brief were pointed out by Pamela Ader's counsel. But the justice said Fourte later conceded that a number of them were AI-generated and not properly checked.
Rimu is represented by Brian Cohen, Gregory Blue, Brian Belowich and Joanna Sandolo of Lachtman Cohen & Belowich LLP.
Jason Ader is represented by Howard Benjamin of Howard Benjamin.
The case is Rimu Capital Ltd. v. Ader et al., case number 1:23-cv-05065 in the U.S. District Court for the Southern District of New York.
--Additional reporting by Emily Sawicki and Matt Perez. Editing by Robert Rudinger.
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