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OpenAI Sued for Defamation: Fabricates Legal Accusation Against Radio Host

June 14, 2023

On June 9, The Verge reported that OpenAI has been sued for defamation after Mark Walters, a radio host in Georgia, stated that Walters had been accused of defrauding and embezzling funds from a non-profit organization by ChatGPT.. The system generated the information after a request from a third party, a journalist named Fred Riehl. Walters’ case was filed June 5th in Georgia’s Superior Court of Gwinnett County and he is seeking unspecified monetary damages from OpenAI.

Generative AI systems apparently have no reliable way to distinguish fact from fiction, and when asked for information, particularly if asked to confirm something the questioner suggests is true, they frequently invent dates, facts, and figures.

These “hallucinations” normally don’t amount to much, but sometimes they can cause harm. These include a professor threatening to flunk his class after ChatGPT claimed his students used AI to write their essays, and a lawyer facing possible sanctions after using ChatGPT to research fake legal cases. The lawyer in question recently told a judge: “I heard about this new site, which I falsely assumed was, like, a super search engine.”

OpenAI has a small disclaimer on ChatGPT’s homepage warning that the system “may occasionally generate incorrect information,” but the company also presents ChatGPT as a source of reliable data, describing the system in ad copy as a way to “get answers” and “learn something new.”

We do not know if there is legal precedence to hold a company responsible for AI systems generating false or defamatory information, or whether this case has substantial merit.

Traditionally, Section 230 of the Communications Act shields internet firms from legal liability for information produced by a third party and hosted on their platforms. We do not know whether these protections apply to AI systems, which do not simply link to data sources but generate new information (which sometimes leads to the creation of false data).

The defamation lawsuit filed by Walters in Georgia is novel. The case states that a journalist, Fred Riehl, asked ChatGPT to summarize a real federal court case by linking to an online PDF. ChatGPT responded by creating a false summary of the case that was detailed and convincing but also wrong in several respects. ChatGPT’s summary contained some factually correct information but also false allegations against Walters. It said Walters was believed to have misappropriated funds from a gun rights non-profit called the Second Amendment Foundation “in excess of $5,000,000.” Walters was never accused of any such thing.

Riehl never published the false information generated by ChatGPT but checked the details with another party. It’s not clear from the case filings how Walters then found out about this misinformation.

Despite complying with Riehl’s request to summarize a PDF, ChatGPT is not actually able to access such external data without the use of additional plug-ins. The system’s apparent inability to alert Riehl to this fact is an example of its capacity to mislead users.

Eugene Volokh, a law professor who has written on the legal liability of AI systems, noted in a blog post that although he thinks “such libel claims [against AI companies] are in principle legally viable,” this lawsuit “should be hard to maintain.” Volokh notes that Walters did not notify OpenAI about these false statements, giving them a chance to remove them, and that there have been no actual damages because of ChatGPT’s output. “In any event, though, it will be interesting to see what ultimately happens here,” says Volokh.

Sooner or later, if this behavior continues, surely provable damages will exist.

Sharon D. Nelson, Esq., President, Sensei Enterprises, Inc.
3975 University Drive, Suite 225, Fairfax, VA 22030
Email:  Phone: 703-359-0700
Digital Forensics/Cybersecurity/Information Technology
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