One of Wall Street’s most prestigious law firms,Sullivan & Cromwell, has been forced to apologise to a federal bankruptcy judge after artificial intelligence created serious errors in a court filing. In a letter sent on April 18, 2026, Andrew Dietderich, co-head of the firm’s global restructuring practice, personally apologised to the judge for mistakes in an emergency motion filed in the Chapter 15 bankruptcy case of Prince Global Holdings.
The firm admitted that the document contained multiple inaccuracies caused by AI “hallucinations.” These included invented case names that don’t exist, made-up quotes, wrong summaries of other court decisions, and even references to sections of the US Bankruptcy Code that were either distorted or completely fabricated.“We sincerely regret the errors in the Motion and the burden they have imposed on the Court and the parties,” Dietderich wrote. “I apologise on behalf of our entire team.”
He explained that Sullivan & Cromwell has strict internal rules for using AI tools. Lawyers are told to “trust nothing and verify everything.” In this case, the firm acknowledged that its own protocols were not properly followed. The mistakes came to light after lawyers from the opposing side, Boies Schiller Flexner, pointed them out. The firm quickly filed a corrected version of the motion along with the apology letter.
Sullivan & Cromwell represents liquidators from the British Virgin Islands who are handling the collapse of Prince Global Holdings, part of the Cambodia-based Prince Group. The case is linked to serious allegations against the group’s founder, Chen Zhi, who faces US charges of wire fraud and money laundering related to alleged forced-labour scam operations in Cambodia.
While it is not clear exactly which AI tool was used, the firm is known to have an enterprise licence for OpenAI’s ChatGPT. Partners at Sullivan & Cromwell often charge more than $2,000 per hour for high-stakes bankruptcy work, making the incident particularly embarrassing.This latest case once again shows the ongoing risks of relying on AI for legal work. Even top-tier firms with sophisticated safeguards can run into trouble if lawyers fail to carefully check the output.
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