A lawsuit alleging that the Army misused artificial intelligence in bid evaluation before awarding a $450 million contract could shape how federal agencies document and disclose AI’s role in procurement decisions. The lawsuit comes after the Government Accountability Office denied Trax’s bid protest challenging the Army’s contract award. “The weakness appears to be a classic AI hallucination, with made-up references to Trax’s proposal, that no one on the Source Selection Evaluation Board checked before sending the SSEB report to the Source Selection Authority,” the lawsuit says. According to the Army, the Source Selection Authority did not use AI to evaluate proposals, but Trax said the service “refused to say” whether the SSEB relied on AI during its evaluation. But the administrative record — particularly the SSEB report — could reveal more about how AI was used to evaluate proposals.