Criminal Due Process and Compensatory Sanctions
Goodyear Tire & Rubber Co. v. Haeger15-1406
In Int’l Union v. Bagwell, 512 U.S. 821 (1994), this Court ruled that sanctioned parties must be afforded the protections of criminal due process where sanctions are punitive, but not where they are compensatory. In this case, in a divided decision, the Ninth Circuit affirmed a $2.7 million sanction award imposed under inherent powers as a compensatory sanction. The majority held that sanctions can be compensatory even if the specific amount of sanctions is not directly caused by the alleged misconduct. The first question presented is: Is a federal court required to tailor compensatory civil sanctions imposed under inherent powers to harm directly caused by sanctionable misconduct when the court does not afford sanctioned parties the protections of criminal due process?
DECISIONDecided April 18, 2017 HOLDING
When a federal court exercises its inherent authority to sanction bad-faith conduct by ordering a litigant to pay the other side’s legal fees, the award is limited to the fees the innocent party incurred solely because of the misconduct—or put another way, to the fees that party would not have incurred but for the bad faith.
KAGAN, J., delivered the opinion of the Court, in which all other Members joined, except GORSUCH, J., who took no part in the consideration or decision of the case.
ORAL ARGUMENTArgued January 10, 2017
CERTIORARI STAGEGranted September 29, 2016
United States Court of Appeals for the Ninth Circuit
Decided July 20, 2015