diff --git a/enterprise/storage/lite_llm_manager.py b/enterprise/storage/lite_llm_manager.py
index f1179ebcbc..0ac1ea7a66 100644
--- a/enterprise/storage/lite_llm_manager.py
+++ b/enterprise/storage/lite_llm_manager.py
@@ -346,8 +346,16 @@ class LiteLlmManager:
 
             # User failed to create in litellm - this is an unforseen error state...
             if not response.is_success:
-                if response.status_code == 400 and 'already exists' in response.text:
-                    # user already exists, just return
+                if (
+                    response.status_code in (400, 409)
+                    and 'already exists' in response.text
+                ):
+                    logger.warning(
+                        'litellm_user_already_exists',
+                        extra={
+                            'user_id': keycloak_user_id,
+                        },
+                    )
                     return
                 logger.error(
                     'error_creating_litellm_user',
@@ -478,6 +486,18 @@ class LiteLlmManager:
         )
         # Failed to add user to team - this is an unforseen error state...
         if not response.is_success:
+            if (
+                response.status_code == 400
+                and 'already in team' in response.text.lower()
+            ):
+                logger.warning(
+                    'user_already_in_team',
+                    extra={
+                        'user_id': keycloak_user_id,
+                        'team_id': team_id,
+                    },
+                )
+                return
             logger.error(
                 'error_adding_litellm_user_to_team',
                 extra={
diff --git a/enterprise/tests/unit/test_lite_llm_manager.py b/enterprise/tests/unit/test_lite_llm_manager.py
index 0ec8fe6b65..d148882d8a 100644
--- a/enterprise/tests/unit/test_lite_llm_manager.py
+++ b/enterprise/tests/unit/test_lite_llm_manager.py
@@ -465,6 +465,149 @@ class TestLiteLlmManager:
                 second_call_args = mock_http_client.post.call_args_list[1]
                 assert second_call_args[1]['json']['user_email'] is None
 
+    @pytest.mark.asyncio
+    @patch('storage.lite_llm_manager.logger')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_URL', 'http://test.com')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_KEY', 'test-key')
+    async def test_create_user_already_exists_with_409_status_code(
+        self, mock_logger, mock_http_client
+    ):
+        """Test _create_user handles 409 Conflict when user already exists."""
+        # Arrange
+        first_response = MagicMock()
+        first_response.is_success = False
+        first_response.status_code = 400
+        first_response.text = 'duplicate email'
+
+        second_response = MagicMock()
+        second_response.is_success = False
+        second_response.status_code = 409
+        second_response.text = 'User with id test-user-id already exists'
+
+        mock_http_client.post.side_effect = [first_response, second_response]
+
+        # Act
+        await LiteLlmManager._create_user(
+            mock_http_client, 'test@example.com', 'test-user-id'
+        )
+
+        # Assert
+        mock_logger.warning.assert_any_call(
+            'litellm_user_already_exists',
+            extra={'user_id': 'test-user-id'},
+        )
+
+    @pytest.mark.asyncio
+    @patch('storage.lite_llm_manager.logger')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_URL', 'http://test.com')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_KEY', 'test-key')
+    async def test_create_user_already_exists_with_400_status_code(
+        self, mock_logger, mock_http_client
+    ):
+        """Test _create_user handles 400 Bad Request when user already exists."""
+        # Arrange
+        first_response = MagicMock()
+        first_response.is_success = False
+        first_response.status_code = 400
+        first_response.text = 'duplicate email'
+
+        second_response = MagicMock()
+        second_response.is_success = False
+        second_response.status_code = 400
+        second_response.text = 'User already exists'
+
+        mock_http_client.post.side_effect = [first_response, second_response]
+
+        # Act
+        await LiteLlmManager._create_user(
+            mock_http_client, 'test@example.com', 'test-user-id'
+        )
+
+        # Assert
+        mock_logger.warning.assert_any_call(
+            'litellm_user_already_exists',
+            extra={'user_id': 'test-user-id'},
+        )
+
+    @pytest.mark.asyncio
+    @patch('storage.lite_llm_manager.LITE_LLM_API_URL', 'http://test.com')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_KEY', 'test-key')
+    async def test_add_user_to_team_success(self, mock_http_client, mock_response):
+        """Test successful _add_user_to_team operation."""
+        # Arrange
+        mock_http_client.post.return_value = mock_response
+
+        # Act
+        await LiteLlmManager._add_user_to_team(
+            mock_http_client, 'test-user-id', 'test-team-id', 100.0
+        )
+
+        # Assert
+        mock_http_client.post.assert_called_once()
+        call_args = mock_http_client.post.call_args
+        assert 'http://test.com/team/member_add' in call_args[0]
+        assert call_args[1]['json']['team_id'] == 'test-team-id'
+        assert call_args[1]['json']['member'] == {
+            'user_id': 'test-user-id',
+            'role': 'user',
+        }
+        assert call_args[1]['json']['max_budget_in_team'] == 100.0
+
+    @pytest.mark.asyncio
+    @patch('storage.lite_llm_manager.logger')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_URL', 'http://test.com')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_KEY', 'test-key')
+    async def test_add_user_to_team_already_in_team(
+        self, mock_logger, mock_http_client
+    ):
+        """Test _add_user_to_team handles 'already in team' error gracefully."""
+        # Arrange
+        error_response = MagicMock()
+        error_response.is_success = False
+        error_response.status_code = 400
+        error_response.text = (
+            '{"error":{"message":"User already in team. Member: '
+            'user_id=test-user-id","type":"team_member_already_in_team"}}'
+        )
+        mock_http_client.post.return_value = error_response
+
+        # Act
+        await LiteLlmManager._add_user_to_team(
+            mock_http_client, 'test-user-id', 'test-team-id', 100.0
+        )
+
+        # Assert
+        mock_logger.warning.assert_called_once_with(
+            'user_already_in_team',
+            extra={
+                'user_id': 'test-user-id',
+                'team_id': 'test-team-id',
+            },
+        )
+
+    @pytest.mark.asyncio
+    @patch('storage.lite_llm_manager.LITE_LLM_API_URL', 'http://test.com')
+    @patch('storage.lite_llm_manager.LITE_LLM_API_KEY', 'test-key')
+    async def test_add_user_to_team_other_error_raises_exception(
+        self, mock_http_client
+    ):
+        """Test _add_user_to_team raises exception for non-'already in team' errors."""
+        # Arrange
+        error_response = MagicMock()
+        error_response.is_success = False
+        error_response.status_code = 500
+        error_response.text = 'Internal server error'
+        error_response.raise_for_status.side_effect = httpx.HTTPStatusError(
+            'Server error', request=MagicMock(), response=error_response
+        )
+        mock_http_client.post.return_value = error_response
+
+        # Act & Assert
+        with pytest.raises(httpx.HTTPStatusError):
+            await LiteLlmManager._add_user_to_team(
+                mock_http_client, 'test-user-id', 'test-team-id', 100.0
+            )
+
     @pytest.mark.asyncio
     async def test_generate_key_success(self, mock_http_client, mock_response):
         """Test successful _generate_key operation."""