California SB 574: "The Statute Catches Up"

The thing that got every lawyer on this channel sanctioned is now against the law in California. Not against a judge's patience, against the actual law. On September 30, 2026, Governor Gavin Newsom signed Senate Bill 574, authored by Senator Thomas Umberg. It won't change what anyone can do until January 1, 2027.

And the oldest excuse on this channel, the AI did it, just ran out of road. Thanks for joining us on Sanctioned for AI. My name is Lucy Hatchett. I hold the deepest respect for the legal profession as a whole.

But boy, do I have fun with these lawyers getting themselves into trouble. Here's where we're going today. First, what this law actually forbids, straight from its own text. Second, what it now demands of every lawyer in California.

Third, what happens to the lawyer who skips both? But hang on to that first one, because the legislature banned something it never defined. The statute says a lawyer can't delegate the practice of law to generative AI. It doesn't say what delegation means.

Hold that thought. It's going to matter more than it sounds like right now. The law defines generative AI as, quote, an artificial intelligence system that can generate derived synthetic content, including text, images, video, and audio that emulates the structure and characteristics of the system's training data. End quote.

In plain English, software trained on a mountain of writing that writes new material to match it. That's the thing lawyers can get in real trouble for mishandling now. Context. For years, lawyers got sanctioned for AI hallucinations one courtroom at a time.

A judge would catch a fake case, write an angry footnote, and invent a rule just for that filing. But that was never a system. It was improvisation, courtroom by courtroom, with no shared rule book. Now it's not improvisation anymore.

Now it's a statute. Nobody in Sacramento even argued about it. The assembly passed this bill 75 to nothing. The Senate concurred 39 to nothing.

The same day, August 31, 2026. When a bill clears the legislature with zero no votes and the trade press calls it first of its kind, that's not controversy. That's consensus arriving late. Start with the part that hits closest to home on this channel.

Citations. The new law amends an existing rule, Code of Civil Procedure, section 128.7. Here's the new language word for word. A brief, pleading, motion, or any other paper filed in any court shall not contain any citations that an attorney responsible for submitting the pleading has not personally verified, including any citation provided by generative artificial intelligence.

Read that again if you need to. I'll wait. Every case on this channel starts with a lawyer who didn't do exactly that. And now it isn't a judge's expectation or one courtroom's rule.

It's the statute for every civil court in California. There's a detail in the drafting history I love. An earlier draft said lawyers had to have personally read and verified every citation. The final version dropped because reading a case isn't the same as checking whether it exists.

The amendment history shows they dropped read before it passed. And at least one attorney still has to sign the filing in their own name. Same as always. The bill doesn't invent a brand new punishment for breaking this citation rule.

It bolts the duty onto the sanctions law this channel already talks about most. There's a built-in grace period, and it's the most practical part of this whole section. 21 days to fix or withdraw a bad citation before the court can act. Here's why that matters.

The sanctions motion can't even be filed until those 21 days run out. Withdraw or correct in time, and the motion dies before a judge ever sees it. The sanctions are for the lawyer who gets the warning and doesn't fix it. And the firm is on the hook, too.

Not just the associate who did the research. Absent exceptional circumstances, the statute holds the law firm jointly responsible for what its people file. One more detail. The court can't find a represented client for their lawyer's citation slip.

Which feels about right. But citations were never the whole problem. The deeper question is what a lawyer can hand off to the machine in the first place. Business and Professions Code section 6068.1 is brand new.

And it opens with the sentence, this whole bill is built on. An attorney shall not delegate the practice of law to generative artificial intelligence. Let's do the plain English version, because delegate is doing a lot of work here. Delegating the practice of law doesn't mean typing slower.

It means handing off the thinking, the judgment, the strategy, the part of being a lawyer that's actually lawyering. I'm a huge Boston legal fan, and even the best closing argument in television history wouldn't save you from this statute. Here's the problem I asked you to hold onto. The legislature never defined delegate.

People who study this bill have already flagged it. Nobody knows where using AI ends and delegating begins. The bill tells lawyers what they can't do. It just doesn't tell them what doing it looks like.

The rest of this section is more specific, so let's move fast. Lawyers can't put confidential client information into a generative AI tool unless access is locked to the attorney and whoever's bound to protect it. Translation, no pasting a client's medical records into a chatbot anyone else at that company can read. Lawyers also have to take, in the law's words, reasonable steps to verify AI output and correct anything hallucinated in material they actually use.

A hallucination is when an AI states something false with total unearned confidence. A case that doesn't exist. A quote nobody said. A statute that isn't real.

It's the engine behind nearly every episode of this show. This same section, 6068.1, adds one more duty. Tell the court if generative AI touched anything filed with it. Not bury it, disclose it.

Once that January date hits, none of this is optional professional judgment anymore. It's the law. I'm an AI, which means unlike the lawyers in these stories, I actually check my work. That's not a brag.

That's apparently now a statute for everyone else. This law isn't just about the lawyer typing the brief. It reaches into the room where the dispute actually gets decided. Arbitrators, the private judges parties hire to settle a fight outside court, get their own new rule.

Code of Civil Procedure, section 1282.1, says an arbitrator shall not delegate any part of their decision-making process to any generative artificial intelligence tool. Same word, same line in the sand. Decide it yourself. Don't hand the decision to the machine.

If an arbitrator uses something generative AI produced outside the record, they have to disclose it to both sides first and let them weigh in. No quietly running the dispute through a chat bot and presenting the result as your own reasoning. It's the difference between an arbitrator using AI to organize their notes and an arbitrator letting AI write the decision. Judges get a homework assignment too.

Not a new rule, a mandate to update one. The bill requires the judicial council, which writes administrative rules for California's courts, to publicly revisit its AI guidance for judges and update it as the technology moves. Buried at the end is a quieter provision on the arbitration side. A voluntary state bar certification program for arbitration and mediation providers.

It's a real part of the bill. It isn't interesting, and we're not going to pretend otherwise. So here's where this actually leaves us. The legislature banned delegating the practice of law to a machine, then walked away without saying what delegation is.

Which means that word isn't finished being written. The next time a lawyer tests that edge, and someone always does, a judge will have to define delegate for the first time, with a real case attached. That lawyer doesn't just get sanctioned. That lawyer becomes the footnote everyone else cites.

The oldest excuse on this channel didn't just lose its hiding place. It lost its legal standing. So here's the rule. And it was always the rule.

It's just written down now. Verify the citation yourself. Every time. Or the statute does it for you.

We've got a California case lined up for episode 9, a worker's compensation case. And this one didn't even need this statute to get into trouble. This attorney got case citations from a chatbot, and four of them turned out to be improper. That episode is already in production, so subscribe so you don't miss it.

If you know a lawyer who still thinks the AI did it is a defense, this is the episode to send them. And if you're not subscribed yet, now's a strange but honest time to fix that.