When AI-Generated Letters, Complaints, and Claims Become Litigation Pressure: What Businesses Should Know

Consumer-facing businesses, particularly in the technology, media, and telecommunications sectors, are increasingly encountering claims filed by self-represented individuals who use generative AI to research legal theories, draft complaints, and prepare court filings. The same low-cost tools that can help legitimate claimants, organize facts, understand legal processes, and articulate disputes, can also be used to generate demand letters, complaints, motions, and arbitration submissions quickly and at scale. As a result, the practical barriers to initiating or threatening legal action have declined significantly.

Generative AI can serve important access-to-justice goals by helping self-represented litigants better understand procedures, organize information, and communicate potential claims. Businesses should not treat either AI assistance or pro se status as evidence that a claim lacks merit. The emerging risk is significantly different. Some claimants are now using free or low-cost AI tools to generate high-volume, citation-heavy, or superficially sophisticated filings without a sound factual or legal basis, increasing settlement pressure and defense costs.

Courts and litigants are increasingly confronting filings from self-represented parties that have been prepared with the assistance of generative AI. These may involve state consumer protection claims; electronic communications disputes involving email marketing, wiretapping, call recording, website pixels, or alleged disclosure of personal information; billing and service disputes involving technology and telecommunications providers; or claims brought by individuals subject to arbitration agreements who attempt to litigate in court or submit self-drafted demands directly into arbitration.

AI-assisted filings may appear polished, properly formatted, citation-heavy, and professionally drafted, yet still require careful scrutiny to determine whether the allegations, legal authorities, and factual assertions are accurate and well-founded. Equally important, AI allows a single claimant to generate substantially more filings, correspondence, motions, and other advocacy within a case, often very quickly. As a result, businesses may face not only a greater number of claims, but each case often involves a much higher volume of filings and a corresponding increase in expenses.

What This Means for Businesses

More filings and more case activity. AI materially lowers the cost of generating legal-style text, including demand letters, motions, correspondence, responses, and amended pleadings. For businesses, this means not only more individual claims, but also greater activity within each claim—more pages to review, more authorities to verify, and more issues to triage. That increased volume raises defense costs even when the underlying claim ultimately lacks merit.

The unverified-AI problem. The use of AI by self-represented litigants is not per se problematic. However, unverified AI output is. Generative AI tools can fabricate case citations, misquote real judicial opinions, invent procedural history, and overstate or misstate legal holdings. When that output is copied into a filing without independent verification or lawyer review, businesses and courts are forced to spend time separating genuine issues from nonexistent authority or unsupported assertions.

Evolving court disclosure and verification requirements. Courts are responding to AI-assisted filings through a growing patchwork of local rules, standing orders, and judge-specific requirements. Many focus not on banning AI, but on disclosure, human review, and verification of factual assertions and legal citations.[1] Businesses and counsel should track the requirements of the courts and judges before whom they are litigating, because noncompliance by an opposing party may provide a basis to seek relief, including sanctions.

Practical Steps

Companies facing an uptick in AI-assisted claims should consider resisting the temptation to handle these claims reflexively—either by ignoring them or by settling quickly to make them go away. A more deliberate approach will serve businesses better over time:

1. Investigate promptly and thoroughly. Upon notice of any claim, conduct a thorough preliminary investigation into the underlying facts. Map the relevant consumer-facing disclosures, website or app data flows, third-party pixels or similar technologies, and applicable terms of use and privacy policies. Review your policies and terms of use to determine if you are consistent and transparent. An early merits assessment serves two purposes: it enables efficient resolution of claims that have genuine substance, and it arms the company to mount a prompt, informed defense of claims that do not. Do not assume that a short, unpolished filing signals a frivolous claim, or that a lengthy or sophisticated-looking filing signals a meritorious claim. Investigate the merits as you normally would.
   
   
2. Avoid reflexive nuisance-value settlements. Prompt settlement may be appropriate where early investigation shows a claim has merit or where business considerations warrant resolution. But reflexively paying facially weak claims solely to avoid the cost of response creates perverse incentives for repeat or copycat filings, often by the same pro se plaintiff. Companies should distinguish between legitimate pro se claims that deserve efficient resolution, and unsupported claims designed primarily to extract a quick payout.
   
   
3. Evaluate fee-shifting where a statute or precedent allows it. Some consumer protection statutes permit defendants to seek fees where an action is frivolous, brought in bad faith, or otherwise meets the statutory standard. For example, Maryland's Consumer Protection Act, Md. Code, Com. Law § 13-408(c), provides the court may order the plaintiff to pay the defendant's reasonable attorneys' fees if it appears to the court's satisfaction that an action was brought in bad faith or is frivolous. In appropriate cases, seeking fee-shifting can deter bad-faith filings without discouraging legitimate consumer claims. Even where a plaintiff is judgment-proof or unlikely to pay a fee award, a sanctions or fee-shifting order may have deterrent value and may provide useful context if the same claimant files similar actions later.
   
   
4. Consider vexatious-litigant remedies for repeat bad-faith filers. Where a claimant repeatedly files meritless actions, businesses may consider whether vexatious-litigant or pre-filing-review remedies are available to prohibit a plaintiff from filing any new litigation without review and approval by a presiding judge of the court in which the action is to be filed. These remedies should be reserved for appropriate cases and supported by a documented pattern of abusive filings, not mere pro se status or ordinary claim volume.[2]
   
   
5. Remember that Rule 11 applies equally to pro se litigants. Federal Rule of Civil Procedure 11 (and many of its state procedural counterparts) imposes the same good-faith factual and legal inquiry obligations on self-represented litigants as on attorneys. Pro se status does not exempt a party from potential sanctions for frivolous or bad-faith filings, even though courts often afford self-represented parties additional latitude.
   
   
6. Evaluate IFP proceedings for frivolousness. Where a claimant proceeds in forma pauperis under 28 U.S.C. § 1915 (or analogous state law), the statute requires dismissal, at any time, of an action found to be frivolous or malicious or that fails to state a claim. An action is "frivolous" if it "lacks an arguable basis either in law or in fact." Neitzke v. Williams, 490 U.S. 319, 325 (1989). Businesses facing an IFP claimant with a facially deficient complaint should evaluate whether it is appropriate to bring this standard to the court's attention.
   
   
7. Recognize potential AI-generated red flags. Train employees who handle consumer complaints, as well as in-house and outside counsel, to identify potential indicators of unverified AI-assisted drafting. Examples include nonexistent case citations, quotations that do not appear in cited authority, generic legal standards disconnected from the alleged facts, unusually uniform formatting paired with thin factual allegations, or repeated demand letters with similar structure. These indicators should trigger further review—not automatic dismissal of the claim.

Looking Ahead

AI-assisted self-representation is likely to become a routine feature of consumer litigation and pre-suit dispute activity. That development should not be treated as inherently improper. In many cases, AI may help individuals with limited resources present legitimate claims more clearly and efficiently. But as AI-generated legal text becomes easier to produce, businesses should expect more filings and demands that appear sophisticated but nonetheless require careful review for factual accuracy, legal support, and citation integrity.

Businesses that invest now in disciplined intake-and-assessment workflows, clear escalation protocols, citation-verification procedures, and a deliberate settlement strategy, will be better positioned to resolve meritorious claims efficiently while resisting unsupported claims designed to create nuisance-value pressure.

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Soraya Mohamed and Pat Curran regularly represent businesses in state and federal courts in disputes involving individual and self-represented claimants, including consumer-related claims. For questions about the issues discussed in this advisory or to discuss your organization's specific exposure, please contact Soraya, Pat, or another member of Davis Wright Tremaine's communications, technology + privacy & security, or litigation teams, or sign up for our alerts.