Courts and regulators are increasingly treating AI-generated filing errors as professional misconduct, with new examples showing sanctions for fabricated citations and concerns about waived privileges. The report describes instances where lawyers were sanctioned after submitting fabricated citations and invented quotations, and a separate ruling where using a general-purpose AI chatbot to prepare a defense strategy waived attorney-client privilege. A database cited in the report tracks more than 1,300 cases globally where courts commented on AI-generated hallucinations in filings, suggesting that AI tools are no longer viewed as risk-free drafting aids. For legal and compliance functions supporting higher education institutions—especially those handling student discipline, procurement, research misconduct, and litigation—this reinforces the need for verification protocols. The story also argues that domain-specific AI systems differ from general-purpose models, but emphasizes that the obligation to verify content remains on counsel and the submitting party.