China's First AI Hallucination Infringement Case Ruled: AI Models Lack Civil Subject Qualification, Platform Not Liable Without Fault

China's first AI hallucination infringement case has recently been ruled. A user sued an AI platform after the AI generated incorrect information and promised 100,000 yuan in compensation, but the Hangzhou Internet Court dismissed the claim. The court clarified that AI models lack civil subject qualification and cannot independently bear civil liability; the platform had fulfilled its reasonable duty of care by prompting "AI-generated content is for reference only" on the interface and taking measures to improve accuracy, so it was not liable for any fault. The Supreme People's Court emphasized that this ruling does not condone AI errors but clarifies the boundary of legal liability. AI hallucination is a limitation of current technology; the law does not demand "zero errors" from platforms. It is necessary to regulate while developing and develop while regulating to create a tolerant atmosphere for innovation. At the same time, malicious infringement will be severely punished—for example, a case involving trade secret infringement of CNC machine tools resulted in a compensation of 380 million yuan, reflecting protection for high-end manufacturing.