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Wadsworth v. Walmart Inc.

Court sanction

U.S. District Court, District of Wyoming · D. Wyo. · Decided February 24, 2025

Citation:
Wadsworth v. Walmart Inc., 348 F.R.D. 489 (D. Wyo. 2025)
AI tool:
MX2.law (Morgan & Morgan in-house AI platform)
Sanction amount:
$3,000 (Ayala) + $1,000 each (Morgan, Goody); Ayala's pro hac vice revoked

What happened

Three attorneys -- Rudwin Ayala (Morgan & Morgan), T. Michael Morgan (supervising partner, Morgan & Morgan), and Taly Goody (local counsel) -- filed motions in limine in a product liability case involving an allegedly defective hoverboard. Nine cases were cited; eight did not exist. Ayala had used his firm's in-house AI platform, MX2.law, prompting it to "add to this Motion in Limine Federal Case law from Wyoming setting forth requirements for motions in limine." None of the attorneys independently verified the citations before signing and filing.

Outcome

Ayala fined $3,000 and had his pro hac vice admission revoked. Morgan and Goody each fined $1,000. Judge Kelly H. Rankin rejected the argument that the supervising attorney bore no responsibility because a subordinate prepared the filing, holding: 'Blind reliance on another attorney can be an improper delegation of this duty.' The court stated 'a fake opinion is not existing law' for purposes of Rule 11. The sanctions order provided the empirical basis for D. Wyo. General Order 2025-01 (issued three months later).

Wadsworth is the case that answered whether a firm-branded AI tool changes the Rule 11 analysis. It does not. MX2.law was a Morgan & Morgan internal platform, presented to the firm’s lawyers as a professional resource, and Judge Rankin still treated using it without verification as a Rule 11 violation. The decision is also the first AI-hallucination case to result in pro hac vice revocation, and it extended supervisory liability to the partner who had not drafted the motion but had signed off on it.

Primary sources

Last verified: April 24, 2026. Verify against primary sources before relying on this in a filing.