Tech Corner: Backfiring legal AI tools, AI coding in retail, data centers

The legal profession has to be extra-cautious about any use of AI research and writing tools, partly because of AI hallucinations, as these lawyers can attest.

Let’s talk about tech trends and the upcoming tech in 2025, and as we do, let’s keep in mind that any technology – especially tech that operates quickly, uses large amounts of data culled from numerous sources and whose creators promise you immediate rewards – requires policies, frameworks, and technical controls designed to ensure that the systems are developed and used responsibly, ethically, and in compliance with legal regulations.

And this means its users must mitigate potential risks, such as bias, privacy violations, and harmful outputs, specifically by defining clear boundaries for how AI can be used within an organization.

Let’s keep that top of mind as we dig into this post.

Your legal AI tool just ruined your motion

On Monday, a judge sanctioned three lawyers for citing fake cases generated using artificial intelligence in a personal injury lawsuit against Walmart.

Rudwin Ayala, T Michael Morgan, and Taly Goody are attorneys who have been representing the plaintiffs suing the retail behemoth Walmart. The lawsuit concerns claims that Walmart sold a defective hoverboard that caught fire and burned down the plaintiffs’ home.

In January, the three attorneys filed motions with the help of an artificial intelligence (AI) tool called “MX2.law” to add case law to his motions; the tool ended up citing nine cases, eight of which do not exist.

Ayala drafted the motions under the direction of his supervisor, Morgan. Other than suggesting Ayala exclude a term used during a deposition, Morgan was not involved in the drafting of the motions. Goody, local counsel in the matter, was entirely uninvolved in drafting the motions. Morgan and Goody were not provided a copy of the motions prior to filing; however, all three attorneys e-signed the filed motions before filing.

Ayala admitted that he did not verify the accuracy of these cases before including the cases in the motions. “Ayala admits that the cases are non-existent and his reliance on the AI platform was misplaced,” the judge noted in the case.

After Judge Kelly Rankin issued an Order to Show Cause [see link above], the three attorneys withdrew the motions, were honest about the use of AI, payed opposing counsels’ fees for defending the motions, and implemented “policies, safeguards, and training to prevent another occurrence in the future.”

The judge revoked Ayala’s pro hac vice status (which had enabled him to practice temporarily in a jurisdiction where he did not have a bar license) and imposed a $3,000 fine. As such, Ayala was removed as counsel of record.

Morgan’s pro hac vice admission was not revoked, but Judge Rankin imposed a $1,000 fine on Morgan for failing to adhere to his obligations under Federal Rules of Civil Procedure (FRCP). And Goody was similarly fined $1,000 for her failure to comply with the FRCP.

Judge Rankin noted that “[w]hen done right, AI can be incredibly beneficial for attorneys and the public … Overall, technological advances have greatly accelerated our world, and AI will likely be no exception … As attorneys transition to the world of AI, the duty to check their sources and make a reasonable inquiry into existing law remains unchanged.”

Speaking of Walmart – An AI coding tool

Walmart has an AI-powered coding assistant for developers there and is planning a broader rollout of the tool.

Last year, the tools helped the retailer save about four million developer hours by streamlining deployments and delivering code faster with fewer bugs, CEO Doug McMillon said. Walmart plans to make the tools available to all developers in North America and India this year.

“As we become more productive and reduce the amount of time we work on routine tasks, that gives us time to develop tools that help us grow the business and move faster,” McMillon said.

Nvidia: Strong as ever, thanks to data centers, Blackwell

Nvidia’s latest earnings report topped analysts’ expectations and indicated continued revenue growth for the chip giant. It posted revenue of $39.3 billion in the quarter ended January 26, up 78% from a year earlier.

Just in case anyone was overly worried that China’s DeepSeek AI model would dent demand for Nvidia’s advanced superconductors (in lieu of less processor-intensive AI models), the most recent data belies fears.

Data center-related sales were the bulk of the Nvidia’s total revenue, coming out to $35.6 billion for the period, up 93% from one year earlier. It doesn’t hurt that the company will serve as a key partner for President Trump’s Stargate AI project – a $500 billion initiative to build data centers and AI infrastructure in the United States. 

Also of note is the fact that Nvidia’s Blackwell’s Decompression Engine is already in strong demand, despite its recent deployment. The tool is supposed to be able to access massive amounts of memory over a high-speed link – 900 gigabytes per second of bidirectional bandwidth – to accelerate database queries for the highest performance in data analytics and data science existing today.

Still, Nvidia has at least one unique challenge: It is susceptible to geopolitical challenges because its chips are designed in the US but are manufactured in Taiwan by TSMC – an island in East Asia that is always in danger of an invasion or other aggressive act by China.

Meta data center

Meta is planning to build a huge data center for AI that could cost as much as $200 billion, The Information reported on Tuesday, citing people familiar with the matter.

Meta executives have informed data center developers that the company is considering building the campus in states including Louisiana, Wyoming or Texas, with senior leaders having visited potential sites this month, the report said.

But a Meta spokesperson denied the report when contacted by Reuters, saying its data center plans and capital expenditures have already been disclosed and that anything beyond that is “pure speculation.”