Judge Tosses L.A. Film School Fraud Suit and Fines Lawyer Over ChatGPT Brief

A federal judge has thrown out a whistleblower lawsuit that accused the Los Angeles Film School of defrauding the government over student loans, and has fined the lawyer who filed it for submitting a brief written with ChatGPT, Variety reported on 26 October 2026.

Judge Stanley Blumenfeld dismissed the case with prejudice, a legal term meaning the claims cannot be filed again. He found that much of the alleged conduct fell outside the six-year statute of limitations, the deadline for bringing this kind of claim.

The case dates to 2024. Two former executives of the school, Dave Phillips, who had been vice president of job placement, and Ben Chaib, who had been vice president of admissions, filed a False Claims Act suit. That law lets private people sue on the government's behalf when they believe federal money has been obtained by fraud. The case was filed on 20 June 2024 in the U.S. District Court for the Central District of California, docket No. 2:24-cv-05214.

The 2024 complaint alleged that the school paid outside companies, including Ivar Music Group, to hire its own students for two-day jobs. That, the suit said, inflated the school's job placement figures. It also alleged those figures were used to keep the school's accreditation and its eligibility for federal student loans. The complaint quoted an internal document stating that most graduates report yearly income of $0 to $5,000 in their field of study. These are the claims the former executives made. The court did not rule on them, because the dismissal rested on the time limit.

The filing that drew the fine came later. A 76-page brief submitted in April cited a case that does not exist, Darwich v. Department of Economic Security. It also cited two real cases that did not support the points they were used to make, and one of those was written by Judge Blumenfeld himself.

Phillips told the court that he drafted the brief himself using ChatGPT, an AI chatbot, and then gave it to his attorney to review. The judge fined attorney Mark Kleiman $5,000 for submitting the AI-written brief without disclosing that it had been generated that way. The judge chose not to sanction Phillips or Chaib, because neither is a lawyer.

For anyone who has never looked inside a court file, the episode carries a simple lesson. A filing goes out under a lawyer's name, and the lawyer is responsible for every case cited in it, however the first draft was produced. Judges have been seeing more of these errors as AI tools spread, and this order shows one way a court can respond.

The case's last filing was on 6 August 2026.