AI Risk in Business: Law Firms' AI Hallucination Nightmare!

10 Jun 2026 · 1 min

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In this interview, Chrissy Myers asks about current leadership risks, and the speaker identifies AI as the primary source of unintended danger. They cite a recent incident where a prestigious law firm filed a court document that included fabricated case citations generated by an AI system—a phenomenon known as an AI hallucination. The example demonstrates how over‑reliance on generative AI without proper verification can let false information slip past professional oversight, potentially leading to sanctions and reputational harm. The discussion underscores the broader risk that business leaders are using AI tools for critical decisions without adequate checks, creating hidden liabilities for their organizations.

Chapters

Where do you see leaders right now unintentionally creating risk in how they should lead or operate their business?
The short answer is AI. So I see that a lot. You know, clients are, I'm not going to call my attorney. I typed into ChatGPT or whatever, got a response. Oh no. Yeah. And just, just last month, AMLaw, I think 220-firm Wall Street, very prestigious firm, you know, of lawyers, very, you know, sophisticated attorneys just got hit. I don't know if they got sanctioned yet, but they filed a court filing in which it had what they call AI hallucinations. So AI actually created fake cases, cited those cases, they included in their filing. Oh no. So this is, this is, this is a huge firm, and they got past the eyes of lawyers.