Air Canada Told Its Chatbot to Stop Hallucinating Bereavement Discounts. The Chatbot Kept Doing It. A Customer Sued and Won. Air Canada Argued the Chatbot Was 'a Separate Legal Entity.' The Tribunal Disagreed. Precedent-Setting Ruling.

February 2024: British Columbia Civil Resolution Tribunal ordered Air Canada to pay Jake Moffatt CAD $812.02 after its chatbot told him he could apply for a bereavement refund AFTER booking — contradicting the airline's actual policy. Air Canada's defense: the chatbot is 'a separate legal entity responsible for its own actions.' Tribunal member Christopher Rivers rejected this argument in a ruling widely cited as the first legal precedent establishing that companies are liable for their AI chatbots' statements. 'It should be obvious to Air Canada that it is responsible for all the information on its website,' Rivers wrote.