Sullivan & Cromwell, one of America's most prestigious law firms, admitted to a federal bankruptcy court that a major filing contained multiple AI "hallucinations." Andrew Dietderich, head of S&C's restructuring practice, apologized to Judge Martin Glenn on Saturday for errors including misquoting the US bankruptcy code and incorrectly citing cases in an April 9 filing.

The errors were spotted by Boies Schiller Flexner, which represents Prince Group and its owner Chen Zhi, who faces wire fraud and money laundering charges in the US. The case involves nearly $9bn in bitcoin authorities want to seize, connected to alleged forced-labor scam compounds in Cambodia. S&C maintains an enterprise license for ChatGPT.

This marks another high-profile AI error by a major law firm. Last year, Latham & Watkins admitted a lawyer used Anthropic's Claude model to draft a filing with an apocryphal citation. S&C partners typically charge over $2,000 per hour, raising questions about quality control as firms adopt AI tools to handle complex bankruptcy work.