Company Sues OpenAI After Woman Allegedly Generated Fake Lawsuit Causing $300,000 In Legal Costs

Nippon Life Insurance Company of America filed a lawsuit against OpenAI, claiming that its chatbot, ChatGPT, allegedly gave a Nippon employee bogus legal advice, inducing her to reopen a lawsuit she had already settled with her employer.

The employee, Graciela Dela Torre, approached the lawyers who represented her in a disability benefits claim against Nippon about reopening the case because she believed the agreement they reached “resulted from potential errors or omissions of important facts and documentation,” according to a lawsuit filed in the United States District Court for the Northern District of Illinois. Dela Torre’s attorney assured her that there were no such errors or omissions and reminded her that she had signed a release precluding her from reopening the case, according to the lawsuit.

After her attorney advised against reopening the matter, Dela Torre allegedly uploaded her attorney’s advice to ChatGPT and asked it if she was being “gaslighted,” the lawsuit claims. The chatbot replied that her attorney’s message was gaslighting, and that it “invalidated” her feelings, “dismissed her perspective, and deflected responsibility for her dissatisfaction,” according to the lawsuit.

CHICAGO, ILLINOIS – MARCH 03: The ChatGPT app by OpenAI is shown on a cell phone on March 03, 2026 in Chicago, Illinois. OpenAI reworked an agreement with the Pentagon governing the Defense Department’s use of its AI services after concerns were raised that the military would use OpenAI’s systems for domestic surveillance. (Photo by Scott Olson/Getty Images)

Dela Torre allegedly fired her attorneys based on ChatGPT’s advice and consulted the chatbot about how to reopen her case against Nippon, the lawsuit claims. Nippon’s lawsuit also states that ChatGPT created a draft motion for Dela Torre to reopen her case, even though “ChatGPT was aware of the settlement Agreement between the parties.” Following her motion to reopen her lawsuit, Dela Torre filed 21 motions, one subpoena, and eight notices and statements, all of which were created using ChatGPT, according to the lawsuit. (RELATED: Teen Fatally Overdoses After Consulting ChatGPT For Drug Advice, Mom Claims)

In an order from February 13, 2025, the court ruled that Dela Torre couldn’t reopen the case. However, on February 12, 2025, Dela Torre filed a claim against Davies Life & Health and Allsup, LLC, and later amended her complaint against those companies to add Nippon as a defendant, again asserting the same claims, according to Nippon’s lawsuit.

Nippon claimed that “Dela Torre’s abuse of the judicial system, aided and abetted by OpenAI’s unlicensed practice of law” led to the company sustaining “significant harm and reputational damage.” It seeks $300,000 in compensatory damages, $10 million in punitive damages, and to permanently enjoin OpenAI from giving Dela Torre legal advice and “engaging in the practice of law in the state of Illinois.”