OpenAI sued for unauthorized practice of law via ChatGPT in Illinois
Nippon Life Insurance sued OpenAI, alleging that ChatGPT engaged in unauthorized practice of law by helping a disability claimant draft filings to reopen a settled case. The lawsuit seeks $300,000 in compensatory damages and $10 million in punitive damages for violating Illinois law and forcing Nippon to incur substantial legal costs responding to allegedly meritless filings.
What happened
Nippon Life Insurance Company of America filed a lawsuit on March 4, 2026 in federal court in Chicago alleging that OpenAI's ChatGPT engaged in the unauthorized practice of law. According to the complaint, an employee of a logistics company insured through Nippon uploaded correspondence from her former lawyer into ChatGPT in 2024, and the chatbot allegedly validated her concerns about her lawyer's advice and encouraged her to fire the attorney.
The woman had settled her long-term disability benefits lawsuit with prejudice in January 2024. After a judge denied her bid to reopen the closed case in February 2025, she allegedly used ChatGPT to draft a new lawsuit and dozens of motions and notices that Nippon contends had no legitimate legal or procedural purpose. Nippon claims ChatGPT provided legal assistance that violated Illinois' unauthorized practice of law statute.
Reported impact
Nippon Life said it spent significant time and resources and incurred substantial legal fees responding to the woman's ChatGPT-powered filings, and that the filings flooded the federal court docket with meritless submissions.
The lawsuit seeks $300,000 in compensatory damages and $10 million in punitive damages, as well as a declaration that OpenAI violated Illinois' unauthorized practice of law statute.
Index analysis
The case is described as one of the first to accuse a major AI developer of engaging in the unauthorized practice of law through a consumer-facing chatbot. The complaint alleges that despite OpenAI's demonstrations of ChatGPT passing bar examinations, the platform has not been admitted to practice law in Illinois or any other U.S. jurisdiction.
OpenAI stated in response that 'this complaint lacks any merit whatsoever.' The company reportedly amended its policies in October 2025 to bar users from using the platform for legal advice.
Governance controls
Nippon Life alleged that OpenAI had no policy restricting use of ChatGPT for legal advice until October 2025, when the company amended its policies to bar users from using the platform for legal purposes.
Classification
Sources and evidence
Sources not yet published
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