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Public trackerEvidence checked Jul 23, 2026 · Latest decision Jul 21, 2026Public incidents are risk signals, not usage-adjusted rates
Evidence-linked corpus record: this page is generated from the structured public record and has a publication-readiness score of 90/100. It passed the source, context, and standalone-summary checks used for public indexing; individual legal editorial review is not represented.
In re Celsius Network LLC
S.D. New York (Bankruptcy) · Nov 9, 2023
NY / federalEditorial impact: lowmisrepresented authoritybankruptcytrial
Direct answer
What happened in this matter?
Misrepresented: Other | Report generated by AI contained almost no citations and the expert did not review underlying sources; court found it was not based on sufficient facts or data and excluded the report. Outcome: Expert report excluded as unreliable. The court found the 172-page valuation report was generated by AI at the expert's instruction, contained almost no supporting citations, factual inaccuracies (e.g., asserting governance rights CEL lacked), duplicated text and incorrect trade dates, and relied on a non-peer-reviewed 'fair value' method.…
- Why the court cared
- The record concerns whether cited material supported the proposition attributed to it. The tracked outcome is Expert report excluded as unreliable; the linked source controls the precise reasoning.
- Why it matters now
- AI-drafted expert reports must be cite-checked and source-anchored before counsel signs off — unreliable reports get excluded under Rule 702.
Why this matter is tracked
Misrepresented: Other | Report generated by AI contained almost no citations and the expert did not review underlying sources; court found it was not based on sufficient facts or data and excluded the report. Outcome: Expert report excluded as unreliable. The court found the 172-page valuation report was generated by AI at the expert's instruction, contained almost no supporting citations, factual inaccuracies (e.g., asserting governance rights CEL lacked), duplicated text and incorrect trade dates, and relied on a non-peer-reviewed 'fair value' method. The report was excluded under Rule 702.Counsel at fault was later sanctioned both in Texas, and in New York through a reciprocal sanction (see here).
Operational lesson
AI-drafted expert reports must be cite-checked and source-anchored before counsel signs off — unreliable reports get excluded under Rule 702.
Record details
New YorkSingle-state evidence scope
CourtS.D. New York (Bankruptcy)
Jurisdictionfederal
Circuit2nd Circuit
DateNov 9, 2023
UN
AI toolUnidentified
Party typeExpert
OutcomeExpert report excluded as unreliable
Known amountNot recorded
Professional sanctionNo
Attribution boundary
What the record establishes about AI use
not established
The current record does not establish a specific AI tool. Do not infer AI use beyond the source.
Procedural posture
Expert report excluded as unreliable
Correction behavior
Correction behavior is not separately verified in the current record.
Tracked discrepancy record
2 citation, quotation, or authority issues are recorded in the source dataset.
- Misrepresented: Other | Report generated by AI contained almost no citations and the expert did not review underlying sources; court found it was not based on sufficient facts or data and excluded the report.
- Misrepresented: Exhibits & Submissions | Report asserted features for CEL (e.g., governance rights) that the token never had; court identified this factual inaccuracy as undermining reliability.
Questions this record answers
- What happened in In re Celsius Network LLC?
- Misrepresented: Other | Report generated by AI contained almost no citations and the expert did not review underlying sources; court found it was not based on sufficient facts or data and excluded the report. Outcome: Expert report excluded as unreliable. The court found the 172-page valuation report was generated by AI at the expert's instruction, contained almost no supporting citations, factual inaccuracies (e.g., asserting governance rights CEL lacked), duplicated text and incorrect trade dates, and relied on a non-peer-reviewed 'fair value' method.…
- Why does In re Celsius Network LLC matter for legal AI risk?
- AI-drafted expert reports must be cite-checked and source-anchored before counsel signs off — unreliable reports get excluded under Rule 702.
- What does the public record establish about In re Celsius Network LLC?
- The record summarizes the outcome described in the linked public source. The recorded document is hosted in the upstream publisher archive. This page is not a substitute for the complete docket, subsequent history, or jurisdiction-specific advice.
- Which source supports this In re Celsius Network LLC summary?
- The recorded source is Damien Charlotin case archive. It is classified as publisher document archive; review the linked material and subsequent docket history before relying on this summary.
Related matters
Related by court, jurisdiction, tool, or classified failure pattern. Similarity does not imply the same facts or outcome.