Kheir

IN THE UNITED STATES BANKRUPTCY COURT November 04, 2025

FOR THE SOUTHERN DISTRICT OF TEXAS Nathan Ochsner, Clerk

HOUSTON DIVISION

IN RE: §

§ CASE NO: 24-35814

DEONDRA JOYCE KHEIR, §

§ CHAPTER 7

Debtor. §

§

DEONDRA JOYCE KHEIR, §

§

Plaintiff, §

§

VS. § ADVERSARY NO. 25-3033

§

TITAN TEAM LLC, THE MONEY §

SOURCE INC., and AUCTION.COM, §

§

Defendants. §

MEMORANDUM OPINION

As a matter of first impression, this Court has been tasked with determining whether Mr.

Derrick D. King, counsel for Deondra Joyce Kheir (“Plaintiff”), utilized generative artificial

intelligence to manufacture legal authority without verifying the content within such authorities,

or the existence of such authorities, in violation of the Southern District of Texas General Order

2025-04. The Court publishes this opinion to remind lawyers that confirming the accuracy of cited

caselaw is a basic, routine matter, and something to be expected from a practicing attorney,

especially because carelessness, good faith, or ignorance are not excuses for submitting materials

that are non-compliant with Federal Rule of Bankruptcy Procedure 9011 (“Bankruptcy Rule”). No

lawyer should be using ChatGPT or any other generative AI product to perform legal research

without verifying the results, much less placing such unverified results in pleadings filed in this

Court.

On August 21, 2025, the Court conducted a hearing and for the reasons stated herein, the

Court finds that Derrick D. King violated Southern District of Texas General Order 2025-04 and

Bankruptcy Rule 9011 and is ordered to (1) reimburse Counsel for Auction.Com, Inc.

(“Defendant”) its reasonable and necessary attorney’s fees and costs associated with this matter.

Counsel for Auction.Com, Inc. is invited to file a fee application for its reasonable and necessary

fees associated with this matter no later than November 17, 2025; (2) register and obtain six hours

of continuing education from the State Bar of Texas on the use of generative AI in the courts; (3)

provide a copy of this Court’s order to his client, and; (4) file a certificate of compliance with the

Clerk of Court which must be accomplished no later than December 31, 2025. Mr. King will also

be referred to Chief United States District Judge Randy Crane and the State Bar of Texas Chief

Disciplinary Counsel for possible disciplinary action.

I. FINDINGS OF FACT

This Court makes the following findings of fact and conclusions of law pursuant to Federal

Rule of Civil Procedure 52, which is made applicable to adversary proceedings pursuant to

Bankruptcy Rule 7052. To the extent that any finding of fact constitutes a conclusion of law, it is

adopted as such. To the extent that any conclusion of law constitutes a finding of fact, it is adopted

as such. This Court made certain oral findings and conclusions on the record. This Memorandum

Opinion supplements those findings and conclusions. If there is an inconsistency, this Memorandum

Opinion controls.

A. Background

1. On February 11, 2025, Deondra Joyce Kheir filed her “Original Complaint To Determine

The Validity, Priority, Existence or Extent of The Valadity [Sic] Of Assignment(s), Contract,

Title, Liens And Request For Declaratory Judgment and Other Claim(s)” (the “Complaint”).1

1 ECF No. 1.

2. On May 23, 2025, Auction.Com, LLC, filed “Defendant Auction.Com, LLC’s Motion To

Dismiss Plaintiff’s Complaint (Doc. No. 1) And Brief In Support” (“Auction’s Motion to

Dismiss”).2

3. On May 23, 2025, The Money Source Inc. filed its “Motion To Dismiss Plaintiff's

Complaint (Doc. 1) and Brief In Support” (“Money Source’s Motion to Dismiss”).3

4. On June 11, 2025, Plaintiff filed “Plaintiff’s Response In Opposition To Defendant

Auction.Com, LLC’s Motion To Dismiss” (“Plaintiff’s Response to Motion to Dismiss”).4

5. On July 2, 2025, Auction.Com, LLC, filed its “Auction.com, LLC’s Reply In Support Of

Its Motion to Dismiss Plaintiff’s Complaint” (the “Reply”) alleging that Derrick D. King

utilized generative artificial intelligence to manufacture legal authority without verification

the content within such authorities, or the existence of such authorities.5

6. On July 3, 2025, this Court issued an order requiring Mr. Derrick D. King to demonstrate to

the Court either (1) why Derrick D. King has not violated Federal Rule of Civil Procedure

11(b) or (2) why Derrick D. King should not be sanctioned pursuant to Federal Rule of Civil

Procedure 11 or this Court’s inherent authority (the “Show Cause Order”).6

7. On July 16, 2025, Titan Team, LLC, filed its “Notice Of Appearance And Motion To

Dismiss Plaintiff’s Original Complaint (Doc 1).”7

8. On August 5, 2025, Plaintiff filed her “Formal Opposition To Titan Team LLC’s Motion To

Dismiss.”8

9. On August 5, 2025, Plaintiff filed her “Motion For Leave To Filr [Sic] An Amended

Response To Auction.Com And The Money Sources Inc.’s Motion To Dismiiss [Sic].”9

10. On August 6, 2025, Plaintiff filed her “Motion For Leave To Filr [Sic] An Amended

Adversary Petition.”10

11. On August 6, 2025, Plaintiff filed her “Motion For Leave To File An Amended Response To

Auction .Com And The Money Sources Inc.’s Motion To Dismiiss [Sic].”11

2 ECF No. 8.

3 ECF No. 9.

4 ECF No. 11.

5 ECF No. 15.

6 ECF No. 16.

7 ECF No. 19.

8 ECF No. 20.

9 ECF No. 21.

10 ECF No. 22.

11 ECF No. 23.

12. On August 19, 2025, Auction.Com filed “Auction.Com’s Response In Opposition To

Plaintiff’s Motion For Leave To File An Amended Response To Auction.Com’s Motion

To Dismiss.”12

13. On August 19, 2025, Auction.Com filed “Auction.Com’s Response In Opposition To

Plaintiff’s Motion For Leave To File An Amended Adversary Petition.”13

14. On August 21, 2025, the Court held a hearing and now issues its instant Memorandum

Opinion.

II. CONCLUSIONS OF LAW

A. Jurisdiction and Venue

This Court holds jurisdiction pursuant to 28 U.S.C. § 1334 and exercises its jurisdiction in

accordance with Southern District of Texas General Order 2012–6.14 Section 157 allows a district

court to “refer” all bankruptcy and related cases to the bankruptcy court, wherein the latter court

will appropriately preside over the matter.15 This Court determines that pursuant to 28 U.S.C.

§ 157(b)(2)(A) and (O) this proceeding contains core matters, as it primarily involves proceedings

concerning the administration of this estate.16 This proceeding is also core under the general

“catch-all” language because “the imposition of sanctions on litigants in a bankruptcy case is

clearly a matter ‘arising in’ such a case.”17

This Court may only hear a case in which venue is proper.18 28 U.S.C. § 1409(a) provides

that “a proceeding arising under title 11 or arising in or related to a case under title 11 may be

12 ECF No. 32.

13 ECF No. 33.

14 In re: Order of Reference to Bankruptcy Judges, Gen. Order 2012–6 (S.D. Tex. May 24, 2012).

15 28 U.S.C. § 157(a); see also In re: Order of Reference to Bankruptcy Judges, Gen. Order 2012-6 (S.D. Tex. May

24, 2012).

16 See 11 U.S.C. § 157(b)(2)(A), (O).

17 Wayland v. McVay (In re Tbyrd Enters. LLC), 354 F. App'x 837, 839 (5th Cir. 2009); see also In re Stomberg, 487

B.R. 775, 805 (Bankr. S.D. Tex. 2013).

18 28 U.S.C. § 1408.

commenced in the district court in which such case is pending.” Plaintiff’s main chapter 7 case is

presently pending in this Court and therefore, venue of this proceeding is proper.

B. Constitutional Authority to Enter a Final Order

While bankruptcy judges can issue final orders and judgments for core proceedings, absent

consent, they can only issue reports and recommendations on non-core matters.19 This is a core

proceeding pursuant to 28 U.S.C. § 157(b)(2)(A) and (O). Accordingly, this Court concludes that

the narrow limitation imposed by Stern v. Marshall does not prohibit this Court from entering a

final order here.20 Thus, this Court wields the constitutional authority to enter a final order.

III. ANALYSIS

A. Generative A.I.

“Generative” AI, unlike the older “predictive” AI, is “a machine-learning model that is

trained to create new data, rather than making a prediction about a specific dataset. A generative AI

system is one that learns to generate more objects that look like the data it was trained on.”21

Platforms like ChatGPT are powered by “large language models” that teach the platform to create

realistic-looking output.22 They can write a story that reads like it was written by Stephen King (but

wasn’t) or pen a song that sounds like it was written by Taylor Swift (but wasn’t).23 But they can't

do your legal research for you. ChatGPT does not access legal databases like Westlaw or Lexis, draft

19 See 28 U.S.C. §§ 157(b)(1), (c)(1); see also Stern v. Marshall, 564 U.S. 462, 480 (2011); Wellness Int’l Network,

Ltd. v. Sharif, 135 S. Ct. 1932, 1938–40 (2015).

20 See, e.g., Badami v. Sears (In re AFY, Inc.), 461 B.R. 541, 547-48 (8th Cir. BAP 2012) (“Unless and until the

Supreme Court visits other provisions of Section 157(b)(2), we take the Supreme Court at its word and hold that the

balance of the authority granted to bankruptcy judges by Congress in 28 U.S.C. § 157(b)(2) is constitutional.”); see

also Tanguy v. West (In re Davis), No. 00-50129, 538 F. App’x 440, 443 (5th Cir. 2013) (“[W]hile it is true that Stern

invalidated 28 U.S.C. § 157(b)(2)(C) with respect to ‘counterclaims by the estate against persons filing claims against

the estate,’ Stern expressly provides that its limited holding applies only in that ‘one isolated respect.’ We decline to

extend Stern’s limited holding herein.”) (citing Stern v. Marshall, 564 U.S. 462, 503 (2011)).

21 Adam Zewe, Explained: Generative AI, MIT News (Nov. 9, 2023), https://news.mit.edu/2023/explained-generative-

ai-1109 (emphasis added).

22 Id.

23 See id.

and input a query, review and analyze each of the results, determine which results are on point, and

then compose an accurate, Bluebook-conforming citation to the right cases—all of which it would

have to do to be a useful research assistant. 24 Instead, these AI platforms look at legal briefs in their

training model and then create output that looks like a legal brief by “placing one most-likely word

after another” consistent with the prompt it received.25

B. Whether Derrick D. King violated General Order 2025-04 and Bankruptcy Rule

9011(b)(2)

As expressly laid out in the Southern District of Texas General Order 2025-0426:

Rule 11 of the Federal Rules of Civil Procedure requires that an attorney or self-

represented litigant certifies their claims, defenses, and other legal contentions are

warranted by existing law and the factual contentions have evidentiary support.

Attorneys and self-represented litigants are cautioned against submitting to the

Court any pleading, written motion, or other paper drafted using generative

artificial intelligence (e.g., ChatGPT, Harvey.AI, generative AI services) without

checking the submission for accuracy as certain technologies may produce factually

or legally inaccurate content and should never replace the lawyer’s independent

legal judgment. Any attorney or self-represented litigant who signs a pleading,

written motion, or other paper submitted to the Court will be held responsible for

the contents of that filing under Rule 11, regardless of whether generative artificial

intelligence drafted any portion of that filing. See Fed. R. Civ. P. 11(c) (providing

for imposition of an “appropriate sanction”—including nonmonetary directives, a

penalty payable to the court, or payment to the opposing party of attorney's fees and

expenses directly resulting from the violation—if, after notice and a reasonable

opportunity to respond, the Court determines that Rule 11(b) has been violated).27

Additionally, Bankruptcy Rule 9011(b)(2) provides that:

By presenting to the court a petition, pleading, written motion, or other document—

whether by signing, filing, submitting, or later advocating it—an attorney or

unrepresented party certifies that, to the best of the person's knowledge,

information, and belief formed after an inquiry reasonable under the circumstances

24 Jennifer Case, AI Was Supposed to Democratize Legal Research. What Happened?, LawNext (May 14, 2025),

https://directory.lawnext.com/library/ai-was-supposed-to-democratize-legal-research-what-happened/.

25 Brian Barrett, “You Can't Lick a Badger Twice”: Google Failures Highlight a Fundamental AI Flaw, Wired (Apr. 23,

2025, 7:44 PM), https://www.wired.com/story/google-ai-overviews-meaning/.

26 Bankruptcy Local Rule 1001-1(b) (“In addition to these rules, the Local Rules of the District Court, the

Administrative Procedures for CM/ECF, and the standing and general orders govern practice in the bankruptcy

court.”).

27 S.D. Tex. Gen. Order 2025-04 (May 7, 2025).

. . . the claims, defenses, and other legal contentions are warranted by existing law

or by a nonfrivolous argument to extend, modify, or reverse existing law, or to

establish new law.28

Plaintiff’s Response to the Motion to Dismiss contains the following Generative AI

hallucinations:

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

1 “Bad faith is more than Non-Existent Case.

negligence; it includes

dishonest purpose, moral Brasher v. Stewart does not exist as cited. The volume

obliquity, and conscious number, reporter abbreviation, and first page of the case

wrongdoing.” Brasher v. result in Sabine Pilot Serv., Inc. v. Hauck, 687 S.W.2d

Stewart, 687 S.W.2d 733, 736 733, 736 (Tex. 1985).

(Tex. App. Dallas 1985, no

writ).29 The quoted text does not appear in Sabine.

2 “A homeowner does have Misrepresentation of Authority.

standing to challenge an

assignment on grounds that The quoted text does not appear in Reinagel. The case

would render it void.” actually states, “[T]he obligor may defend ‘on any

Reinagel v. Deutsche Bank ground which renders the assignment void,’” but “they

Nat’l Tr. Co., 735 F.3d 220, have no right to enforce its terms unless they are its

225 (5th Cir. 2013).30 intended third-party beneficiaries.” Reinagel v.

Deutsche Bank Nat’l Tr. Co., 735 F.3d 220, 225, 228

(5th Cir. 2013) (emphasis in original).

3 “Void assignments are Misrepresentation of Authority.

legally ineffective and

confer no rights on the The quoted text does not appear in Morlock. The

assignee.” Morlock, L.L.C. Morlock court actually analyzed the legal issue

v. Nationstar Mortgage, pertaining to a non-borrower’s standing to remove an

L.L.C., 447 S.W.3d 42, 45 alleged cloud on its title to the property. Morlock,

(Tex. App. Houston [14th L.L.C. v. Nationstar Mortg., L.L.C., 447 S.W.3d 42, 43,

Dist.] 2014).31 45 (Tex. App. Houston [14th Dist.] 2014).

28 Fed. R. Bankr. P. 9011(b)(2).

29 ECF No. 11, at 2.

30 ECF No. 11, at 2.

31 ECF No. 11, at 3.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

4 “[A] trustee who actively Misrepresentation of Authority.

participates in the wrongful

foreclosure process can be The quoted text does not appear in Miller. The Miller

liable despite the protections court did not interpret Section 51.007(f) of the Texas

of § 51.007(f).” Miller v. Property Code or address any issues involving a

Homecomings Financial, substitute trustee’s duties or protections. Miller v.

LLC, 881 F. Supp. 2d 825, Homecomings Fin., LLC, 881 F. Supp. 2d 825, 832

832 (S.D. Tex. 2012).32 (S.D. Tex. 2012).

5 “To prove a civil conspiracy, a Misrepresentation of Authority.

plaintiff must show: (1) two or

more persons; (2) an object to The quoted text does not appear as original text from

be accomplished; (3) a meeting the Juhl court. While the case lists the common

of the minds; (4) one or more elements of a civil conspiracy claim, it appears that a

unlawful, overt acts; and (5) majority of the text quoted by Plaintiff in the Response

damages as the proximate appears to be from a case cited by the Juhl court. See

result.” Juhl v. Airington, 936 Massey v. Armco Steel Co., 652 S.W.2d 932, 934 (Tex.

S.W.2d 640, 644 (Tex.1996).33 1983) (“The essential elements are: (1) two or more

persons; (2) an object to be accomplished; (3) a

meeting of minds on the object or course of action; (4)

one or more unlawful, overt acts; and (5) damages as

the proximate result.”).

6 “[S]trict compliance with the Misrepresentation of Authority.

notice and procedural

requirements of the Texas The quoted text does not appear in Slaughter. Notably,

Property Code is mandatory the Texas Property Code was not enacted until 1983 by

for a valid nonjudicial Acts 1983, 68th Leg., p. 3525, ch. 576,

foreclosure.” Slaughter v. § 1, eff. Jan. 1, 1984. The Texas Supreme Court in 1942

Qualls, 162 S.W.2d 671, 675 could not have interpreted the Texas Property Code

(Tex. 1942).34 because it did not exist until it was enacted in 1983—41

years later.

32 ECF No. 11, at 4.

33 ECF No. 11, at 4.

34 ECF No. 11, at 5.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

7 “The appointment of a Misrepresentation of Authority.

substitute trustee must occur

before any foreclosure action. The quoted text does not appear in Flagstar.

An appointment recorded after

the sale is ineffective to confer The Flagstar court did not address any issues involving

authority retroactively.” a substitute trustee’s appointment or authority. The

Flagstar Bank, FSB v. Walker, referenced pin cite generally addresses a party’s

451 S.W.3d 490, 503 (Tex. fiduciary duty based on an agency theory. Flagstar

App. – Dallas 2014).35 Bank, FSB v. Walker, 451 S.W.3d 490, 503 (Tex.

App.—Dallas 2014, no pet.).

8 “[W]here the appointment of a Misrepresentation of Authority.

substitute trustee is not

properly executed or is The quoted text does not appear in Reardean. The

performed by someone Reardean court did not address any issues involving

without authority, the the invalidity of a foreclosure sale based on an

foreclosure sale is invalid.” improper or unauthorized appointment. The referenced

Reardean v. CitiMortgage, pin cite generally addresses the rejected split-the-note

Inc., No. A- 11-CA-420-SS, theory.

2011 WL 3268307, at *4

(W.D. Tex. July 25, 2011).36

9 “Texas law requires strict Misrepresentation of Authority.

compliance with the deed of

trust, and authority to appoint a The quoted text does not appear in Reardean. The

substitute trustee must be Reardean court did not address any issues involving the

properly delegated by someone invalidity of a foreclosure sale based on an improper or

with the power to do so.” unauthorized appointment. The referenced pin cite

Reardean v. CitiMortgage, Inc., generally addresses the rejected split-the-note theory.

No. A-11-CA-420- SS, 2011

WL 3268307, at *4 (W.D. Tex.

July 25, 2011).37

35 ECF No. 11, at 5.

36 ECF No. 11, at 5.

37 ECF No. 11, at 5.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

10 “A person’s title is not self- Misrepresentation of Authority.

proving. A misrepresentation

of authority renders the The quoted text does not appear in Morlock. The

document void.” Morlock, Morlock court did not address any issues involving the

L.L.C. v. Bank of N.Y. Mellon misrepresentation of authority. The referenced pin cite

Trust Co., N.A., 448 S.W.3d generally addresses a mortgagee’s right to foreclose on

514, 518 (Tex. App. Houston a property, rejecting the contention that a mortgagee

[1st Dist.] 2014, pet. denied).38 must possess or produce a note prior to conducting a

nonjudicial foreclosure sale. Morlock,

L.L.C. v. Bank of New York, 448 S.W.3d 514, 518 (Tex.

App.—Houston [1st Dist.] 2014, pet. denied).

11 “A foreclosure conducted by Misrepresentation of Authority.

an improperly appointed

substitute trustee is void ab The quoted text does not appear in Miller. The Miller

initio.” Miller v. Homecomings court did not interpret Section 51.007(f) of the Texas

Fin., LLC, 881 F. Supp. 2d 825, Property Code or address any issues involving a

832 (S.D. Tex. 2012).39 substitute trustee’s duties or protections. Miller v.

Homecomings Fin., LLC, 881 F. Supp. 2d 825, 832

(S.D. Tex. 2012).

12 “The appointment of a Misrepresentation of Authority.

substitute trustee must be

completed before the trustee The quoted text does not appear in Flagstar.

acts. A sale by a trustee

without proper authority is The Flagstar court did not address any issues involving

without force or effect.” a substitute trustee’s appointment or authority. The

Flagstar Bank, FSB v. Walker, referenced pin cite generally addresses a party’s

451 S.W.3d 490, 503 (Tex. fiduciary duty to the other based on an agency theory.

App. – Dallas 2014).40 Flagstar Bank, FSB v. Walker, 451 S.W.3d 490, 503

(Tex. App.—Dallas 2014, no pet.).

13 “Authority to foreclose must Misrepresentation of Authority.

exist before the act of

foreclosure. A post hoc The quoted text does not appear in James. The James

justification cannot cure an court did not interpret Section 51.007(f) of the Texas

unauthorized act.” James v. Property Code or address any issues regarding the

Wells Fargo Bank, N.A., 533 authority to foreclose. James v. Wells Fargo Bank,

F. App’x 444, 446 (5th Cir. N.A., 533 F. App’x 444, 446–47 (5th Cir. 2013).

2013).41 Rather, the referenced pin cite holds that a plaintiff

38 ECF No. 11, at 5.

39 ECF No. 11, at 5-6.

40 ECF No. 11, at 6.

41 ECF No. 11, at 6.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

cannot state a claim for wrongful foreclose because the

plaintiffs failed to plead that they had lost possession

of the property.

14 “The law will not presume Non-Existent Case.

authority when documents are

defective, ambiguous, or post- Morales v. Chase does not exist as cited. The volume

dated.” Morales v. Chase number, reporter abbreviation, and first page of the case

Home Fin., LLC, 667 F. Supp. result in United States v. McCracken, 667 F. Supp. 2d

2d 678, 682 (S.D. Tex. 2009).42 675, 678 (W.D. Va. 2009). The quoted text does not

appear in Morales.

15 “An unexplained delay in Misrepresentation of Authority.

recording the deed undermines

the credibility and legality of The quoted text does not appear in Richardson.

the foreclosure.” Richardson

v. Wells Fargo Bank, N.A., 873 The Richardson court did not evaluate issues pertaining

F. Supp. 2d 800, 810 to an unexplained delay in recording a deed. Richardson

(N.D. Tex. 2012).43 v. Wells Fargo Bank, N.A., 873 F. Supp. 2d 800, 810

(N.D. Tex. 2012), aff’d, 538 Fd. App’x 391 (5th Cir.

2013). Rather, the referenced pin cite evaluates the issue

relating to a lender’s waiver of its right to accelerate a

mortgage and foreclose on a debt. Id.

16 “The delayed recording of Non-Existent Case.

foreclosure instruments raises

the presumption that the DTND Sierra v. BNY Mellon does not exist as cited. A

transaction was procedurally search of the case information results in People v.

irregular.” DTND Sierra Invs., Dehko, No. 305041, 2013 WL 1165216, at *1 (Mich.

LLC v. Bank of N.Y. Mellon Ct. App. Mar. 21, 2013) (per curiam). The quoted text

Trust. Co., N.A., 2013 WL does not appear in Dehko.

1165216, at *6 (W.D. Tex.

Mar. 20, 2013).44

42 ECF No. 11, at 6.

43 ECF No. 11, at 6.

44 ECF No. 11, at 6.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

17 “When the stated consideration Misrepresentation of Authority.

in a foreclosure deed is

contradicted by the lender’s The quoted text does not appear in Henning.

own financial records, a court

may infer lack of actual sale or The Henning court did not evaluate issues pertaining to

bad faith.” Henning v. One defects in the consideration. Henning v. One West Bank

West Bank FSB, 405 S.W.3d FSB, 405 S.W.3d 950, 957 (Tex. App.—Dallas 2013,

950, 957 (Tex. App. Houston no pet.). Rather, the referenced pin cite generally

[14th Dist.] 2013, no pet.).45 addresses the standards for a motion for summary

judgment in state court and one party’s arguments

raised in its state-court motion for summary judgment.

18 “Inconsistent consideration Non-Existent Case.

and accounting creates a

triable issue as to the Gossett does not exist as cited. A search of the case

legitimacy of the foreclosure name produces Gossett v. Fed. Home Loan Mortg.

transaction.” Gossett v. Fed. Corp., 919 F. Supp. 2d 852 (S.D. Tex. 2013), and the

Home Loan Mortg. Corp., quoted text does not appear in this case.

2013 WL 204448, at *4 (E.D.

Tex. Jan. 17, 2013).46

19 “Testimony that fails to Misrepresentation of Authority.

substantiate a material

transaction under oath The quoted text does not appear in Bittinger. The

undermines the credibility of Bittinger court did not evaluate issues pertaining to the

the foreclosure sale and is sufficiency of evidence to support the consideration

probative of sham connected to a foreclosure sale. Bittinger v. Wells

consideration.” Bittinger Fargo Bank NA, 744 F. Supp. 2d 619, 627 (S.D. Tex.

v. Wells Fargo Bank NA, 744 2010). Rather, the referenced pin cite discusses the

F. Supp. 2d 619, 627 requirements for a qualified written request under the

(S.D. Tex. 2010).47 Real Estate Settlement Procedures Act. Id.

45 ECF No. 11, at 6.

46 ECF No. 11, at 6.

47 ECF No. 11, at 7.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

20 “Equity abhors a forfeiture. Misrepresentation of Authority.

When foreclosure is founded

upon fraud, misrepresentation, The quoted text does not appear in Bonilla. The Bonilla

or procedural default, the sale court did not evaluate the request to invalidate a

cannot stand.” Bonilla v. foreclosure sale. Bonilla v. Roberson, 918 S.W.2d 17,

Roberson, 918 S.W.2d 17, 21 21 (Tex. App.—Corpus Christi– Edinburg 1996, no

(Tex. App. Corpus Christi writ). Rather, the referenced pin cite assesses the

1996, no writ).48 validity of a foreclosure proceedings instituted by a

mortgagee following a borrower’s default of the

mortgage agreement.

21 “Only a trustee or substitute Misrepresentation of Authority.

trustee lawfully appointed

under the deed of trust may The quoted text does not appear in Martin. The Martin

conduct a foreclosure sale.” court did not evaluate the appointment of a substitute

See Martin v. New Century trustee to conduct a foreclosure sale. Martin v. New

Mortg. Co., 377 S.W.3d 79, 88 Century Mortg. Co., 377 S.W.3d 79, 88 (Tex. App.—

(Tex. App.—Houston [1st Houston [1st Dist.] 2012, no pet.). Rather, the referenced

Dist.] 2012, no pet.)49 pin cite assesses the validity of a foreclosure proceedings

instituted by a mortgagee following a borrower’s default

of the mortgage agreement.

22 “The power of sale under a Misrepresentation of Authority.

deed of Trust must be strictly

followed. Otherwise, that sale The quoted text does not appear in Slaughter. Notably,

is void.” Slaughter v. Qualls, the Texas Property Code was not enacted until 1983 by

162 S.W.2d 671, 675 Acts 1983, 68th Leg., p. 3525, ch. 576, § 1, eff. Jan. 1,

(1942).50 1984. The Texas Supreme Court in 1942 could not have

interpreted the Texas Property Code because it did not

exist until it was enacted in 1983—41 years later.

23 “Where the appointment of a Misrepresentation of Authority.

substitute trustee is

unauthorized, any sale made The quoted text does not appear in Miller. The Miller

by that trustee is likewise court did not interpret Section 51.007(f) of the Texas

void.” Miller v. Homecomings Property Code or address any issues involving the

Fin., LLC, 881 F. Supp. 2d appointment of substitute trustees. Miller v.

825, 832 (S.D. Tex. 2012).51 Homecomings Fin., LLC, 881 F. Supp. 2d 825, 832

(S.D. Tex. 2012).

48 ECF No. 11, at 7.

49 ECF No. 11, at 7.

50 ECF No. 11, at 8.

51 ECF No. 11, at 8.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

24 “Bad faith is more than Non-Existent Case.

negligence; it includes

dishonest purpose, moral Brasher v. Stewart does not exist as cited. The volume

obliquity, and conscious number, reporter abbreviation, and first page of the case

wrongdoing.” Brasher v. result in Sabine Pilot Serv., Inc. v. Hauck, 687 S.W.2d

Stewart, 687 S.W.2d 733, 736 733, 736 (Tex. 1985). The quoted text does not appear

(Tex. App. Dallas 1985, no in Sabine.

writ).52

25 “A delay in recording, Misrepresentation of Authority.

especially when coupled with

irregularities, raises a strong The quoted text does not appear in Richardson. The

inference of impropriety.” Richardson court did not evaluate issues pertaining to

Richardson v. Wells Fargo an unexplained delay in recording a deed.

Bank, N.A., 873 F. Supp. 2d Richardson v. Wells Fargo Bank, N.A., 873 F. Supp. 2d

800, 810 (N.D. Tex. 2012).53 800, 810 (N.D. Tex. 2012), aff’d, 538 F. App’x 391 (5th

Cir. 2013). Rather, the referenced pin cite evaluates the

issue relating to a lender’s waiver of its right to

accelerate a mortgage and foreclose on a debt. Id.

26 “Publication of a document Misrepresentation of Authority.

asserting an interest in land,

when knowingly invalid, While the case does, in fact, assess a slander-of-title

constitutes slander of title.” claim, the quoted text does not appear in Williams.

Williams v. Jennings, 755 Williams v. Jennings, 755 S.W.2d 874, 879 (Tex. App.—

S.W.2d 874, 879 (Tex. App. Houston [14th Dist.] 1988, writ denied).

Houston [14th Dist.] 1988).54

27 “The court may infer a meeting Misrepresentation of Authority.

of the minds from concerted

action.” Schlumberger Well While the case does, in fact, assess a civil conspiracy

Surveying Corp. v. Nortex Oil claim, the quoted text does not appear in Williams.

& Gas Corp., 435 S.W.2d 854, Schlumberger Well Surveying Corp. v.

857 (Tex. 1968).55 Nortex Oil & Gas Corp., 435 S.W.2d 854, 855 (Tex.

1968).

52 ECF No. 11, at 9.

53 ECF No. 11, at 9.

54 ECF No. 11, at 9.

55 ECF No. 11, at 9.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

28 “A homeowner does have Misrepresentation of Authority.

standing to challenge an

assignment on grounds that The quoted text does not appear in Reinagel. The case

would render it void.” actually states, “the obligor may defend ‘on any

Reinagel v. Deutsche Bank ground which renders the assignment void,’” but “they

Nat’l Tr. Co., 735 F.3d 220, have no right to enforce its terms unless they are its

225 (5th Cir. 2013).56 intended third-party beneficiaries.” Reinagel v.

Deutsche Bank Nat’l Tr. Co., 735 F.3d 220, 225, 228

(5th Cir. 2013) (emphasis in original).

29 “Void assignments are Misrepresentation of Authority.

legally ineffective and

confer no rights on the The quoted text does not appear in Morlock. The

assignee.” Morlock, L.L.C. Morlock court actually analyzed the legal issue

v. Nationstar Mortgage, pertaining to a non-borrower’s standing to remove an

L.L.C., 447 S.W.3d 42, 45 alleged cloud on its title to the property. Morlock,

(Tex. App. Houston [14th L.L.C. v. Nationstar Mortg., L.L.C., 447 S.W.3d 42, 43,

Dist.] 2014).57 45 (Tex. App. Houston [14th Dist.] 2014).

30 “A trustee who actively Misrepresentation of Authority.

participates in a wrongful

foreclosure, especially through The quoted text does not appear in Miller. The Miller

misrepresentations or court did not interpret Section 51.007(f) of the Texas

irregularities, may be held Property Code or address any issues involving a

liable despite the statutory substitute trustee’s statutory immunity. Miller v.

immunity otherwise afforded Homecomings Fin., LLC, 881 F. Supp. 2d 825, 832

under Tex. Prop. Code § (S.D. Tex. 2012).

51.007(f).” Miller v.

Homecomings Fin., LLC, 881

F. Supp. 2d 825, 832 (S.D.

Tex. 2012).58

56 ECF No. 11, at 10.

57 ECF No. 11, at 10.

58 ECF No. 11, at 11.

QUOTES AND CASES

No. CITED BY PLAINTIFF ACTUAL FINDINGS

31 “When documents recorded in Non-Existent Case.

the public record reflect

inconsistent consideration, and Gossett does not exist as cited. A search of the case

parties are unable to name produces Gossett v. Fed. Home Loan Mortg.

substantiate the consideration, Corp., 919 F. Supp. 2d 852 (S.D. Tex. 2013), and the

it raises a fact issue as to quoted text does not appear in this case.

whether the sale was

legitimate.” Gossett v. Fed.

Home Loan Mortg. Corp.,

2013 WL 204448, at *4 (E.D.

Tex. Jan. 17, 2013).59

32 “Equity will not enforce a Misrepresentation of Authority.

foreclosure that is tainted with

concealment, irregularity, or The quoted text does not appear in Bonilla. The

fraud.” Bonilla v. Roberson, Bonilla court did not evaluate fraud or related

918 S.W.2d 17, 21 (Tex. App. allegations regarding the validity of a sale. Bonilla v.

Corpus Christi 1996, no writ).60 Roberson, 918 S.W.2d 17, 21 (Tex. App.—Corpus

Christi–Edinburg 1996, no writ). Rather, the

referenced pin cite assesses the validity of a

foreclosure proceeding instituted by a mortgagee

following a borrower’s default of the mortgage

agreement.

Derrick D. King included the above AI-generated citations in the Plaintiff’s Response to

the Motion to Dismiss and failed to ensure the caselaw cited to was accurate before he filed the

pleading with this Court. Southern District of Texas General Order 2025-04 provides: “[a]ny

attorney or self-represented litigant who signs a pleading, written motion, or other paper submitted

to the Court will be held responsible for the contents of that filing under Rule 11, regardless of

whether generative artificial intelligence drafted any portion of that filing.” Bankruptcy Rule

9011(b)(1)-(2) provides that when a party presents a pleading to the Court, “by signing, filing,

59 ECF No. 11, at 11.

60 ECF No. 11, at 11.

submitting, or later advocating it—an attorney or unrepresented party certifies that . . . it is not

presented for any improper purpose . . . [and] the claims, defenses, and other legal contentions are

warranted by existing law.” Furthermore, the court can “impose an appropriate sanction” for

violations of Bankruptcy Rule 9011(b).61 The available sanctions include a nonmonetary directive,

an order to pay a penalty to the court, or, in some circumstances, an order directing the violator to

pay his or her opponent’s attorneys’ fees.62 But sanctions “must be limited to what suffices to deter

repetition of the conduct or deter comparable conduct by others similarly situated.”63

Here, Derrick D. King included AI hallucinations in the Plaintiff’s Response to the Motion

to Dismiss, as enumerated above.64 At the show cause hearing on August 21, 2025, Derrick D.

King testified as follows:

THE COURT: This Document 11, the one that’s been referred to here as a “Response,” . .

. it was drafted by you, correct?

MR. KING: In portion, your Honor, . . . my client helped, we helped each other solve

issues and thoughts, I was working on the factual concerns . . . and work

she provided to me I took it and looked at it --

THE COURT: Is your client an attorney?

MR. KING: No, not at all your Honor, just was essentially helping me with the theories

of the case and then when I went forward with it. I just didn’t go all the way

through.

THE COURT: The law in these 32 cases that you cited, how did you come about it, putting

those cases and citations in your pleading? . . . How was that developed?

MR. KING: The work that my client and I were working on, she provided what she

thought was correct, and I accepted it and didn’t necessarily think anything

of it, so, I went with it, and --

THE COURT: Did you check any of these cases?

61 See Fed. R. Bankr. P. 9011(c)(1).

62 Id. at (c)(4)(A).

63 Id.

64 See supra, III.B.

MR. KING: I did your Honor, I checked some of them, and that’s what I’m saying to the

court, there’s no excuse, I’m owning it but the problem was that I wasn’t

using Westlaw at the time . . . .65

THE COURT: I don’t understand how you came up with some of these cases . . . were they

generated through some kind of AI platform?

MR. KING: Not on my behalf your honor . . .

THE COURT: Well, have you tried to figure out how they were created, have you asked

your client, do I need to put your client on the stand?

MR. KING: I don’t know how she came up with some of the concepts . . . I don’t know

what happened or how it happened, I failed, and I acknowledge that, but I

don’t, I didn’t do any AI work . . .

THE COURT: That still doesn’t answer my question.

MR. KING: She may have used AI, your Honor, I’m not saying that she didn’t, I-I don’t

know . . .66

The Court then called Ms. Kheir to the stand, who testified as follows:

THE COURT: Did you assist Mr. King in preparation of this document, the one that we’re

referring to here? Document 11?

MS. KHEIR: Yes, your Honor.

THE COURT: Ok. And what kind of legal training do you have?

MS. KHEIR: I went to Rice University, and as a paralegal.

THE COURT: Do you have a certificate?

MS. KHEIR: I do . . .

The COURT: How did you come up with these cases, did you give Mr. King these cases?

MS. KHEIR: I did, I did give him some . . .

THE COURT: Ok, so did you use some form of generative AI?

MS. KHEIR: Yes, from my professor --

65 Show Cause Hr’g Recording, at 10:35:32-36:52, August 21, 2025.

66 Id. at 10:38:30-39:38.

THE COURT: You did?

MS. KHEIR: Yes, mmhmm.

THE COURT: Did you verify any of these cases?

MS. KHEIR: I didn’t have access to Westlaw or Lexis at the time . . . and I just want to

say that I apologize to the court, because I feel like it generated from me . .

. I made a mistake.67

Thus, Plaintiff admitted giving Derrick D. King cases created by generative AI, and

Derrick D. King failed to ensure that the cases were real and that the case quotations were accurate

before he signed the Response to the Motion to Dismiss and filed it with this Court.68 Therefore,

Derrick D. King filed a signed pleading asserting legal contentions that were not “warranted by

existing law,” as required by Bankruptcy Rule 9011(b)(2) and Southern District of Texas General

Order 2025-04 and is therefore subject to appropriate sanctions.

For the reasons stated above, the Court finds that Derrick D. King violated Southern

District of Texas General Order 2025-04 and Bankruptcy Rule 9011 and is ordered to (1) reimburse

Counsel for Auction.Com, Inc., for its reasonable and necessary attorney’s fees and costs

associated with this matter. Counsel for Auction.Com, Inc. is invited to file a fee application for

its reasonable and necessary fees associated with this matter no later than November 17, 2025; (2)

register and obtain six hours of continuing education from the State Bar of Texas on the use of

generative AI in the courts; (3) provide a copy of this Court’s order to his client, and (4) file a

certificate of compliance with the Clerk of Court which must be accomplished no later than

December 31, 2025. Mr. King will also be referred to Chief United States District Judge Randy

Crane and the State Bar of Texas Chief Disciplinary Counsel for possible disciplinary action.

67 Id. at 10:45:20-47:52.

68 ECF No. 11.

IV. CONCLUSION

An order consistent with this Memorandum Opinion will be entered on the docket

simultaneously herewith.

SIGNED November 4, 2025

7 ¢ Eduardo V. Me

Chief United States Bankruptcy Judge