Lawyers hired by the Chicago Housing Authority recently cited Illinois Supreme Court case Mack v. Anderson in an effort to persuade a judge to reconsider a jury’s $24 million verdict against the agency in a case involving the alleged poisoning of two children by lead paint in CHA-owned property.

The problem?

The case doesn’t exist.

In the latest headache for CHA, law firm Goldberg Segalla used artificial intelligence, specifically ChatGPT, in a post-trial motion and neglected to check its work, court records show. A jury decided in January, after a roughly seven-week trial, that CHA must pay more than $24 million to two residents who sued on behalf of their children, finding the agency responsible for the children’s injuries, including past and future damages.

The firm apologized for the error in a June 18 court filing, calling it a “serious lapse in professionalism.”

“An exhaustive investigation revealed that one attorney, in direct violation of Goldberg Segalla’s AI use policy, used AI technology and failed to verify the AI citation before including the case and surrounding sentence describing its fictitious holding,” said Goldberg Segalla’s lead counsel in the case, Larry Mason, in the filing.

Mason, whom the judge admonished for shouting during closing arguments in January, noted that “several contributors” supported him while preparing the motion. He also said in the filing that the investigation found “no intent to deceive the Court” and no other attorneys at the firm were aware of the improper citation.

Goldberg Segalla has since implemented “firm-wide measures to re-educate its attorneys” on its AI use policy, the filing said, and “established preventative measures.” The firm requested that the court not punish CHA for the attorney’s mistake.

In response to a list of Tribune questions, CHA provided a copy of a letter that its interim Chief Legal Officer Elizabeth Silas sent Wednesday to Mason and said Goldberg Segalla has taken “all responsibility” in this matter.

In the letter, Silas thanked Mason for bringing the AI issue to the agency’s attention and for apologizing for the error.

“As you know, CHA expects its outside counsel to hold themselves to the highest responsible and ethical standards,” Silas said. “We sincerely hope that the Court recognizes this unfortunate error and recognizes Goldberg Segalla’s good faith actions to investigate, accept responsibility, and take proper corrective action. Please note, however, that depending on the Court’s finding and rulings, CHA may consider and reserves the right to take additional appropriate action to protect its interests.”

CHA, the third largest public housing authority in the country, serves more than 65,000 households and is the largest single owner of rental housing in the city with more than 21,000 housing units.

The housing authority is without a permanent leader, with Board Chair Angela Hurlock serving as interim CEO. Mayor Brandon Johnson is nearing the final stages of a search for a new chief executive, with mayoral ally Ald. Walter Burnett, 27th, a front-runner for the role.

Cook County Circuit Judge Thomas Cushing called a special hearing Thursday for a further explanation — as CHA’s counsel offered to provide when admitting to the error — on the matter. He required any attorneys responsible for the mistake to be present and for Goldberg Segalla to provide the court with copies of the firm’s policies on the use of AI by attorneys.

At the hearing, Danielle Malaty, the attorney responsible for the mistake, told the judge she did not think ChatGPT could create fictitious legal citations and did not check to ensure the case was legitimate. Three other Goldberg Segalla attorneys then reviewed the draft motion — including Mason, who served as the final reviewer — as well as CHA’s in-house counsel, before it was filed with the court. Malaty was terminated from Goldberg Segalla, where she had been a partner, following her use of AI. The firm, at the time, had an AI policy that banned its use.

“I find all of this very unfortunate,” Malaty said in the hearing. “At no point did I have any intent to deceive the court.”

Mason told the judge that because of his repeated losses when arguing before the court during the trial, he was “very hands off” with the post-trial motion because the case “needed a fresh perspective away from me.”

Mason said he was not expected to check all 58 cases cited in the motion and is “personally disgusted” and “embarrassed” by what happened, calling the mistake “horrific.”

Mason declined to comment to the Tribune. Malaty, who has since started her own practice, declined to comment through her attorney, but said in court that she had engaged in about 70 hours of training related to the use of AI and other ethical issues since making the error.

Matthew Sims, an attorney for the plaintiffs, in the hearing asked for permission to file a motion for sanctions against Goldberg Segalla and CHA based on the “fraud upon the court.” The judge granted his request and said it must be filed by Tuesday.

The next hearing for post-trial motion arguments is scheduled for July 31. CHA continues to contest the ruling and is seeking a verdict in its favor, a new trial on liability or a new trial on damages or to lower the verdict.

Goldberg Segalla has billed CHA more than $389,900 for legal services, invoices dated between March 2024 through December 2024 show. CHA confirmed to the Tribune that it will not be billed for any time or expenses related to this issue, including the Thursday hearing.

The case, filed in January 2022, focused on Shanna Jordan, mother of Jah’mir Collins, now 10, and Morgan Collins, the mother of Amiah Collins, now 6, who sued CHA, The Habitat Co., East Lake Management Group and Environmental Design International, alleging that the defendants knew their unit had lead-based paint and that their children suffered “severe lead poisoning” while living in the unit. The unit was owned by CHA and is located at 7715 N. Marshfield Ave. in Rogers Park.

The lawsuit said that CHA had known the property had lead-based paint since 1992 and faced code violations by the city in the early 2000s because of the hazard.

Property management companies, The Habitat Co. and East Lake Management Group, who had managed the residents’ CHA-owned property, were found not liable for the children’s injuries. The two companies did end up settling with the plaintiffs for much smaller amounts.

Habitat then sued the CHA and two of its attorneys in February for an alleged breach of contract and legal malpractice over the agency’s handling of the lead poisoning lawsuit. A few months prior to the January ruling, Habitat had terminated all of its management agreements with the CHA, covering 16 buildings and approximately 3,400 units of public housing.

Environmental Design International conducted an inspection for lead-based paint in 2017 on behalf of CHA and found lead-based paint, the suit said. Environmental Design International settled with the plaintiffs prior to the trial.

This was not the first time CHA approved housing for residents who then were later diagnosed with lead poisoning. Dozens of children were found to have been poisoned by brain-damaging lead while living in homes and apartments declared safe by the Chicago Housing Authority, a Tribune investigation found in 2017.

The housing authority created a new division in April focused on environmental concerns and hazards for residents. The division’s staff will start by focusing on lead-based paint hazards as they build out the program.

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