OpenAI accused of using ChatGPT to act as unlicensed lawyer
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Occurred: 2024-
Page published: March 2026
Nippon Life Insurance Company of America has sued OpenAI in U.S. federal court, alleging that ChatGPT effectively acted as an unlicensed lawyer for a former disability claimant, generating misleading legal advice and a flood of meritless court filings that caused the insurer financial and procedural harm.
What happened
What happened
Nippon Life Insurance Company of America filed a federal lawsuit in Chicago against OpenAI alleging that former claimant Graciela Dela Torre, whose disability case had already been settled and dismissed "with prejudice" in 2024, used ChatGPT to reopen the case.
The claimant allegedly uploaded emails from her lawyer into the chatbot, which then validated her suspicions that she was being "gaslit," encouraged her to fire her attorney, and drafted dozens of motions and a new lawsuit.
Nippon Life claims it was forced to spend over USD 300,000 in legal fees to respond to these "frivolous" and "hallucinated" filings, which a judge eventually rejected.
It is seeking around USD 300,000 in compensatory damages, 10 million dollars in punitive damages, and a court order permanently barring OpenAI from violating Illinois’ unauthorised practice of law rules.
Why it happened
Why it happened
Nippon argues that ChatGPT went beyond providing general legal information by validating the claimant’s views, advising her about litigation strategy, and drafting specific motions and pleadings tailored to an active case.
The complaint highlights that, despite marketing demonstrations showing ChatGPT passing bar exams, it is not admitted to practice law anywhere and has no professional licence or regulatory oversight.
Critics note that OpenAI’s consumer product design allowed users to obtain seemingly authoritative, case‑specific legal text without robust warnings, controls, or supervision to prevent AI-generated documents from being filed directly in court.
OpenAI has publicly denied wrongdoing, saying the complaint “lacks merit.”
What it means
What it means
The incident is seen to mark a significant escalation in AI-related legal liability.
For the claimant, the episode may have prolonged her dispute, exposed her to the risk of court sanctions, and undermined the protections she had already secured in the original settlement.
For individuals, it highlights the danger of relying on "hallucinating" AI for high-stakes legal matters.
For policymakers, it increases pressure to clarify when AI outputs constitute regulated professional services, impose stricter disclosure and safety obligations on AI providers, and ensure accessible human legal support so vulnerable people are less tempted to rely on unsupervised tools.
System 🤖
System 🤖
Developer: OpenAI
Country: USA
Sector: Business/professional services
Purpose: Provide legal advice
Technology: Generative AI
Issue: Accountability; Anthropomorphism; Transparency
Timeline ⏰
Timeline ⏰
January 2024. The claimant settles her disability case with Nippon and signs a settlement agreement waiving further claims.
2024. The claimant uploads her attorney’s email into ChatGPT, which allegedly validates her concerns and encourages her to question or reject her lawyer’s advice.
January 22, 2025. Acting without her previous lawyer, the claimant files a motion to reopen the settled case, allegedly using ChatGPT‑generated arguments.
February 2025. A federal judge denies the motion to reopen, but the claimant, again allegedly assisted by ChatGPT, files a new lawsuit and dozens of additional motions and notices.
March 4, 2026. Nippon files its lawsuit in federal court in Chicago accusing OpenAI of unauthorised practice of law, tortious interference, and abuse of process, and seeks USD 10 million in punitive damages.
Legal, regulatory ⚖️
Legal, regulatory ⚖️
Nippon Life Insurance Company of America v. OpenAI Foundation and OpenAI Group PBC
News, commentary, analysis 🗞️
News, commentary, analysis 🗞️
AIAAIC Repository ID: AIAAIC2240
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