throbber

`(Slip Opinion)
`
`
`
` OCTOBER TERM, 2016
`
`
`Syllabus
`
`1
`
` NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
`
`
`
` being done in connection with this case, at the time the opinion is issued.
`
`
`
` The syllabus constitutes no part of the opinion of the Court but has been
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` prepared by the Reporter of Decisions for the convenience of the reader.
`
` See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
`
`
`SUPREME COURT OF THE UNITED STATES
`
`
`
` Syllabus
`
` GOODYEAR TIRE & RUBBER CO. v. HAEGER ET AL.
`
`CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
`
`THE NINTH CIRCUIT
` No. 15–1406. Argued January 10, 2017—Decided April 18, 2017
`
`
` Respondents Leroy, Donna, Barry, and Suzanne Haeger sued petitioner
` Goodyear Tire & Rubber Company, alleging that the failure of a
`
`
`Goodyear G159 tire caused the family’s motorhome to swerve off the
`road and flip over. After several years of contentious discovery,
`marked by Goodyear’s slow response to repeated requests for internal
`G159 test results, the parties settled the case. Some months later,
`the Haegers’ lawyer learned that, in another lawsuit involving the
`G159, Goodyear had disclosed test results indicating that the tire got
`
`
`unusually hot at highway speeds. In subsequent correspondence,
`Goodyear conceded withholding the information from the Haegers,
`even though they had requested all testing data. The Haegers then
`sought sanctions for discovery fraud, urging that Goodyear’s miscon-
`duct entitled them to attorney’s fees and costs expended in the litiga-
`tion.
`
`
`The District Court found that Goodyear had engaged in an extend-
`ed course of misconduct. Exercising its inherent power to sanction
`bad-faith behavior, the court awarded the Haegers $2.7 million—the
`entire sum they had spent in legal fees and costs since the moment,
`early in the litigation, when Goodyear made its first dishonest dis-
`
`covery response. The court said that in the usual case, sanctions or-
`dered pursuant to a court’s inherent power to sanction litigation mis-
`conduct must be limited to the amount of legal fees caused by that
`misconduct. But it determined that in cases of particularly egregious
`behavior, a court can award a party all of the attorney’s fees incurred
`
`in a case, without any need to find a “causal link between [the ex-
`
`penses and] the sanctionable conduct.” 906 F. Supp. 2d 938, 975. As
`further support for its award, the District Court concluded that full
`and timely disclosure of the test results would likely have led Good-
`
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`

`

`2
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`GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`
`Syllabus
`year to settle the case much earlier. Acknowledging that the Ninth
`Circuit might require a link between the misconduct and the harm
`caused, however, the court also made a contingent award of $2 mil-
`lion. That smaller amount, designed to take effect if the Ninth Cir-
`cuit reversed the larger award, deducted $700,000 in fees the Hae-
`gers incurred in developing claims against other defendants and
`proving their own medical damages. The Ninth Circuit affirmed the
`full $2.7 million award, concluding that the District Court had
`properly awarded the Haegers all the fees they incurred during the
`
`time when Goodyear was acting in bad faith.
`
`Held: 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 sole-
`ly because of the misconduct—or put another way, to the fees that
`party would not have incurred but for the bad faith. Pp. 5–13.
`
`(a) Federal courts possess certain inherent powers, including “the
`ability to fashion an appropriate sanction for conduct which abuses
`the judicial process.” Chambers v. NASCO, Inc., 501 U. S. 32, 44–45.
`One permissible sanction is an assessment of attorney’s fees against
`a party that acts in bad faith. Such a sanction must be compensato-
`ry, rather than punitive, when imposed pursuant to civil procedures.
`See Mine Workers v. Bagwell, 512 U. S. 821, 826–830. A sanction
`counts as compensatory only if it is “calibrate[d] to [the] damages
`
`caused by” the bad-faith acts on which it is based. Id., at 834. Hence
`the need for a court to establish a causal link between the litigant’s
`misbehavior and legal fees paid by the opposing party. That kind of
`causal connection is appropriately framed as a but-for test, meaning
`a court may award only those fees that the innocent party would not
`have incurred in the absence of litigation misconduct. That standard
`
`
`generally demands that a district court assess and allocate specific
`
`litigation expenses—yet still allows it to exercise discretion and
`
`
`judgment. Fox v. Vice, 563 U. S. 826, 836. And in exceptional cases,
`
`that standard allows a court to avoid segregating individual expense
`
`items by shifting all of a party’s fees, from either the start or some
`midpoint of a suit. Pp. 5–9.
`
`(b) Here, the parties largely agree about the pertinent law but dis-
`pute what it means for this case. Goodyear contends that it requires
`throwing out the fee award and instructing the trial court to consider
`the matter anew. The Haegers maintain, to the contrary, that the
`award can stand because both courts below articulated and applied
`the appropriate but-for causation standard, or, even if they did not,
`the fee award in fact passes a but-for test.
`
`The Haegers’ defense of the lower courts’ reasoning is a non-
`
`starter: Neither court used the correct legal standard. The District
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`

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`Cite as: 581 U. S. ____ (2017)
`
`
`Syllabus
`Court specifically disclaimed the need for a causal link on the ground
`that this was a “truly egregious” case. 906 F. Supp. 2d, at 975. And
`the Ninth Circuit found that the trial court could grant all attorney’s
`fees incurred “during the time when [Goodyear was] acting in bad
`faith,” 813 F. 3d 1233, 1249—a temporal, not causal, limitation. A
`sanctioning court must determine which fees were incurred because
`
`
`of, and solely because of, the misconduct at issue, and no such finding
`lies behind the $2.7 million award made and affirmed below. Nor is
`this Court inclined to fill in the gap, as the Haegers urge. As an ini-
`tial matter, the Haegers have not shown that this litigation would
`have settled as soon as Goodyear divulged the heat-test results (a
`showing that would justify an all-fees award from the moment Good-
`year was supposed to disclose). Further, they cannot demonstrate
`that Goodyear’s non-disclosure so permeated the suit as to make that
`misconduct a but-for cause of every subsequent legal expense, total-
`
`ing the full $2.7 million.
`
`Although the District Court considered causation in arriving at its
`back-up award of $2 million, it is unclear whether its understanding
`
`of that requirement corresponds to the appropriate standard—an un-
`certainty pointing toward throwing out the fee award and instructing
`
`the trial court to consider the matter anew. However, the Haegers
`contend that Goodyear has waived any ability to challenge the con-
`
`tingent award since the $2 million sum reflects Goodyear’s own sub-
`mission that only about $700,000 of the fees sought would have been
`incurred regardless of the company’s behavior. The Court of Appeals
`did not address that issue, and this Court declines to decide it in the
`first instance. The possibility of waiver should therefore be the ini-
`
`tial order of business on remand. Pp. 9–13.
`813 F. 3d 1233, reversed and remanded.
`KAGAN, J., delivered the opinion of the Court, in which all other
`Members joined, except GORSUCH, J., who took no part in the considera-
`tion or decision of the case.
`
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`3
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`

`

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`Cite as: 581 U. S. ____ (2017)
`
`
`Opinion of the Court
`
`1
`
`
` NOTICE: This opinion is subject to formal revision before publication in the
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`
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` preliminary print of the United States Reports. Readers are requested to
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` notify the Reporter of Decisions, Supreme Court of the United States, Wash-
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` ington, D. C. 20543, of any typographical or other formal errors, in order
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` that corrections may be made before the preliminary print goes to press.
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`SUPREME COURT OF THE UNITED STATES
`
`_________________
`
` No. 15–1406
`_________________
`GOODYEAR TIRE & RUBBER COMPANY,
`
`PETITIONER v. LEROY HAEGER, ET AL.
`
`
`ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
`
`
`APPEALS FOR THE NINTH CIRCUIT
`
`[April 18, 2017]
`
` JUSTICE KAGAN delivered the opinion of the Court.
`In this case, we consider a federal court’s inherent au-
`
`thority to sanction a litigant for bad-faith conduct by
`ordering it to pay the other side’s legal fees. We hold that
`such an order 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. A district court has broad discretion to
`calculate fee awards under that standard. But because
`the court here granted legal fees beyond those resulting
`from the litigation misconduct, its award cannot stand.
`I
`Respondents Leroy, Donna, Barry, and Suzanne Haeger
`
`sued the Goodyear Tire & Rubber Company (among other
`defendants) after the family’s motorhome swerved off the
`road and flipped over.1 The Haegers alleged that the
`——————
`1The additional defendants named in the Haegers’ complaint were
`Gulf Stream Coach, the manufacturer of the motorhome, and Spartan
`
`Motors, the manufacturer of the vehicle’s chassis. In the course of the
`litigation, the Haegers reached a settlement with Gulf Stream, and the
`District Court granted Spartan’s motion for summary judgment.
`
`
`
`
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`

`

`2
`
`
`
`GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
`failure of a Goodyear G159 tire on the vehicle caused the
`
`accident: Their theory was that the tire was not designed
`
`to withstand the level of heat it generated when used on a
`
` Discovery in the case
`motorhome at highway speeds.
`lasted several years—and itself generated considerable
`heat. The Haegers repeatedly asked Goodyear to turn
`over internal test results for the G159, but the company’s
`responses were both slow in coming and unrevealing in
`content. After making the District Court referee some of
`their more contentious discovery battles, the parties finally
`settled the case (for a still-undisclosed sum) on the eve of
`trial.
`
`Some months later, the Haegers’ lawyer learned from a
`newspaper article that, in another lawsuit involving the
`G159, Goodyear had disclosed a set of test results he had
`never seen. That data indicated that the G159 got unusu-
`ally hot at speeds of between 55 and 65 miles per hour. In
`ensuing correspondence, Goodyear conceded withholding
`the information from the Haegers even though they had
`requested (both early and often) “all testing data” related
`to the G159. Record in No. 2:05–cv–2046 (D Ariz.), Doc.
`938, p. 8; see id., Doc. 938–1, at 24, 36; id., Doc. 1044–2,
`at 25 (filed under seal). The Haegers accordingly sought
`sanctions for discovery fraud, claiming that “Goodyear
`
`knowingly concealed crucial ‘internal heat test’ records
`related to the [G159’s] defective design.” Id., Doc. 938,
`at 1. That conduct, the Haegers urged, entitled them to
`attorney’s fees and costs expended in the litigation. See
`id., at 14.
`
`The District Court agreed to make such an award in the
`exercise of its inherent power to sanction litigation mis-
`conduct.2 The court’s assessment of Goodyear’s actions
`——————
`
`
`
` 2The court reasoned that no statute or rule enabled it to reach all the
`
` offending behavior. Sanctions under Federal Rule of Civil Procedure
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`11, the court thought, should not be imposed after final judgment in a
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`

`

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`
`3
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`
`Cite as: 581 U. S. ____ (2017)
`
`Opinion of the Court
`was harsh (and is not contested here). Goodyear, the court
`found, had engaged in a “years-long course” of bad-faith
`behavior. 906 F. Supp. 2d 938, 972 (D Ariz. 2012). By
`withholding the G159’s test results at every turn, the
`company and its lawyers had made “repeated and deliber-
`ate attempts to frustrate the resolution of this case on the
`merits.” Id., at 971. But because the case had already
`settled, the court had limited options. It could not take
`
`
`the measure it most wished: an “entry of default judg-
`ment” against Goodyear. Id., at 972. All it could do for
`the Haegers was to order Goodyear to reimburse them for
`attorney’s fees and costs paid during the suit.
`But that award, in the District Court’s view, could be
`
`comprehensive, covering both expenses that could be
`causally tied to Goodyear’s misconduct and those that
`could not. The court calculated that the Haegers had
`spent $2.7 million in legal fees and costs since the mo-
`ment, early in the litigation, when Goodyear made its first
`dishonest discovery response. And the court awarded the
`
`Haegers that entire sum. In the “usual[ ]” case, the court
`reasoned, “sanctions under a [c]ourt’s inherent power
`must be limited to the amount [of legal fees] caused by the
`misconduct.” Id., at 974–975 (emphasis deleted). But this
`case was not the usual one: Here, “the sanctionable con-
`duct r[ose] to a truly egregious level.” Id., at 975. And
`when a litigant behaves that badly, the court opined, “all
`
`of the attorneys’ fees incurred in the case [can] be awarded,”
`without any need to find a “causal link between [those
`
`expenses and] the sanctionable conduct.” Ibid. As further
`support for its decision, the court considered the chances
`that full and timely disclosure of the test results would
`
`
`
`
`
`
`
`
`
`——————
`
`case. See 906 F. Supp. 2d 938, 973, n. 24 (D Ariz. 2012). And sanctions
`
`
`under 28 U. S. C. §1927, it noted, could address the wrongdoing of only
`
`Goodyear’s attorneys, rather than of Goodyear itself. See 906 F. Supp.
`
`2d, at 973.
`
`
`

`

`4
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`
`
`
` GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
`“While
`have affected Goodyear’s settlement calculus.
`
`there is some uncertainty,” the court stated, “the case
`
`more likely than not would have settled much earlier.”
`
`Id., at 972.
`
`Perhaps sensing thin ice, the District Court also made a
`“contingent award” in the event that the Court of Appeals
`
`reversed its preferred one. App. to Pet. for Cert. 180a.
`Here, the District Court recognized the possibility that a
`“linkage between [Goodyear’s] misconduct and [the Hae-
`gers’] harm is required.” Ibid. If so, the court stated, its
`fee award should be reduced to $2 million. The deduction
`of $700,000, which was based on estimates Goodyear
`offered, represented fees that the Haegers incurred in
`developing claims against other defendants and proving
`their own medical damages. See App. 69.
`
`A divided Ninth Circuit panel affirmed the full $2.7
`million award. According to the majority, the District
`Court acted properly in “award[ing] the amount [it] rea-
`sonably believed” the Haegers expended in attorney’s fees
`and costs “during the time when [Goodyear was] acting in
`bad faith.” 813 F. 3d 1233, 1250 (2016). Or repeated in
`just slightly different words: The District Court “did not
`abuse its discretion” in “award[ing] the Haegers all their
`attorneys’ fees and costs in prosecuting the action once
`[Goodyear] began flouting [its] discovery obligations.” Id.,
`at 1249. Judge Watford disagreed. He would have de-
`manded a “causal link between Goodyear’s misconduct
`
`and the fees awarded.” Id., at 1255 (dissenting opinion).
`The only part of the District Court’s opinion that might
`support such a connection, Judge Watford noted, was its
`hypothesis that disclosure of the test results would have
`produced an earlier settlement, and thus obviated the
`need for further legal expenses. But Judge Watford
`thought that theory unpersuasive: Because Goodyear
`would still have had plausible defenses to the Haegers’
`suit, “[i]t’s anyone’s guess how the litigation would have
`
`
`
`
`
`

`

`
`Cite as: 581 U. S. ____ (2017)
`
`Opinion of the Court
` proceeded” had timely disclosure occurred. Ibid. Accord-
`
`ingly, Judge Watford would have reversed the District
`
`Court for awarding fees beyond those “sustained as a
`result of Goodyear’s misconduct.” Id., at 1256.
`
`The Court of Appeals’ decision created a split of authority:
`
`Other Circuits have insisted on limiting sanctions like this
`one to fees or costs that are causally related to a litigant’s
`misconduct.3 We therefore granted certiorari. 579 U. S.
`___ (2016).
`
`
`5
`
`
`
`
`
`II
`
`Federal courts possess certain “inherent powers,” not
`
`conferred by rule or statute, “to manage their own affairs
`so as to achieve the orderly and expeditious disposition of
`cases.” Link v. Wabash R. Co., 370 U. S. 626, 630–631
`(1962). That authority includes “the ability to fashion an
`appropriate sanction for conduct which abuses the judicial
`process.” Chambers v. NASCO, Inc., 501 U. S. 32, 44–45
`(1991). And one permissible sanction is an “assessment of
`attorney’s fees”—an order, like the one issued here, in-
`structing a party that has acted in bad faith to reimburse
`legal fees and costs incurred by the other side. Id., at 45.
`
`This Court has made clear that such a sanction, when
`
`
`imposed pursuant to civil procedures, must be compensa-
`tory rather than punitive in nature. See Mine Workers v.
`Bagwell, 512 U. S. 821, 826–830 (1994) (distinguishing
`compensatory from punitive sanctions and specifying the
`procedures needed to impose each kind).4 In other words,
`the fee award may go no further than to redress the
`——————
`3See, e.g., Plaintiffs’ Baycol Steering Comm. v. Bayer Corp., 419 F. 3d
`794, 808 (CA8 2005); Bradley v. American Household, Inc., 378 F. 3d
`
`
`373, 378 (CA4 2004); United States v. Dowell, 257 F. 3d 694, 699 (CA7
`2001).
`4 Bagwell also addressed “coercive” sanctions, designed to make a
`
`
` party comply with a court order. 512 U. S., at 829. That kind of
`
` sanction is not at issue here.
`
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`
`

`

`
`GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
`wronged party “for losses sustained”; it may not impose an
`additional amount as punishment for the sanctioned
`
`party’s misbehavior. Id., at 829 (quoting United States v.
`Mine Workers, 330 U. S. 258, 304 (1947)). To level that
`
`kind of separate penalty, a court would need to provide
`procedural guarantees applicable in criminal cases, such
`as a “beyond a reasonable doubt” standard of proof. See
`id., at 826, 832–834, 838–839. When (as in this case)
`those criminal-type protections are missing, a court’s
`shifting of fees is limited to reimbursing the victim.
`
`That means, pretty much by definition, that the court
`can shift only those attorney’s fees incurred because of the
`misconduct at issue. Compensation for a wrong, after all,
`tracks the loss resulting from that wrong. So as we have
`previously noted, a sanction counts as compensatory only
`if it is “calibrate[d] to [the] damages caused by” the bad-
`faith acts on which it is based. Id., at 834. A fee award is
`so calibrated if it covers the legal bills that the litigation
`abuse occasioned. But if an award extends further than
`that—to fees that would have been incurred without the
`misconduct—then it crosses the boundary from compensa-
`tion to punishment. Hence the need for a court, when
`using its inherent sanctioning authority (and civil proce-
`dures), to establish a causal link—between the litigant’s
`
`misbehavior and legal fees paid by the opposing party.5
`——————
` 5Rule-based and statutory sanction regimes similarly require courts
`
`to find such a causal connection before shifting fees. For example, the
`Federal Rules of Civil Procedure provide that a district court may order
`a party to pay attorney’s fees “caused by” discovery misconduct,
`Rule 37(b)(2)(C), or “directly resulting from” misrepresentations in
`pleadings, motions, and other papers, Rule 11(c)(4). And under 28
`U. S. C. §1927, a court may require an attorney who unreasonably
`multiplies proceedings to pay attorney’s fees incurred “because of ” that
`misconduct. Those provisions confirm the need to establish a causal
`
`
`
`link between misconduct and fees when acting under inherent authority,
`given that such undelegated powers should be exercised with especial
`
`“restraint and discretion.” Roadway Express, Inc. v. Piper, 447 U. S.
`
`
`
`6
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`

`

`
`
`7
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` Cite as: 581 U. S. ____ (2017)
`
`Opinion of the Court
`That kind of causal connection, as this Court explained
`
`
` in another attorney’s fees case, is appropriately framed as
`a but-for test: The complaining party (here, the Haegers)
`may recover “only the portion of his fees that he would not
`have paid but for” the misconduct. Fox v. Vice, 563 U. S.
`
`
`826, 836 (2011); see Paroline v. United States, 572 U. S.
`
`
`___, ___ (2014) (slip op., at 12) (“The traditional way to
`prove that one event was a factual cause of another is to
`show that the latter would not have occurred ‘but for’ the
`former”).
`In Fox, a prevailing defendant sought reim-
`bursement under a fee-shifting statute for legal expenses
`incurred in defending against several frivolous claims.
`
`See 563 U. S., at 830; 42 U. S. C. §1988. The trial court
`granted fees for all legal work relating to those claims—
`regardless of whether the same work would have been
`done (for example, the same depositions taken) to contest
`
` the non-frivolous claims in the suit. We made clear that
`was wrong. When a “defendant would have incurred [an]
`expense in any event[,] he has suffered no incremental
`harm from the frivolous claim,” and so the court lacks a
`
`
` basis for shifting the expense. Fox, 563 U. S., at 836.
`Substitute “discovery abuse” for “frivolous claim” in that
`sentence, and the same thing goes in this case. Or other-
`
` wise said (and again borrowing from Fox), when “the cost[]
`would have been incurred in the absence of ” the discovery
`
`violation, then the court (possessing only the power to
`compensate for harm the misconduct has caused) must
`leave it alone. Id., at 838.
`
`This but-for causation standard generally demands that
`a district court assess and allocate specific litigation ex-
`penses—yet still allows it to exercise discretion and judg-
`
`
`ment. The court’s fundamental job is to determine whether
`a given legal fee—say, for taking a deposition or drafting a
`motion—would or would not have been incurred in the
`——————
`752, 764 (1980).
`
`
`
`
`
`

`

`
`
` GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
` absence of the sanctioned conduct. The award is then the
`
`sum total of the fees that, except for the misbehavior,
`would not have accrued. See id., at 837–838 (providing
`illustrative examples). But as we stressed in Fox, trial
`courts undertaking that task “need not, and indeed should
`not, become green-eyeshade accountants” (or whatever the
`contemporary equivalent is). Id., at 838. “The essential
`goal” in shifting fees is “to do rough justice, not to achieve
`auditing perfection.” Ibid. Accordingly, a district court
`“may take into account [its] overall sense of a suit, and
`may use estimates in calculating and allocating an attor-
`ney’s time.” Ibid. The court may decide, for example,
`that all (or a set percentage) of a particular category of
`
`expenses—say, for expert discovery—were incurred solely
`because of a litigant’s bad-faith conduct. And such judg-
`ments, in light of the trial court’s “superior understanding
`of the litigation,” are entitled to substantial deference on
`
`appeal. Hensley v. Eckerhart, 461 U. S. 424, 437 (1983).
`In exceptional cases, the but-for standard even permits
`
`a trial court to shift all of a party’s fees, from either the
`start or some midpoint of a suit, in one fell swoop. Cham-
`bers v. NASCO offers one illustration. There, we approved
`
` such an award because literally everything the defendant
`did—“his entire course of conduct” throughout, and indeed
`preceding, the litigation—was “part of a sordid scheme” to
`defeat a valid claim. 501 U. S., at 51, 57 (brackets omit-
`ted). Thus, the district court could reasonably conclude
`that all legal expenses in the suit “were caused . . . solely
`by [his] fraudulent and brazenly unethical efforts.” Id., at
`58. Or to flip the example: If a plaintiff initiates a case in
`complete bad faith, so that every cost of defense is at-
`tributable only to sanctioned behavior, the court may
`again make a blanket award. And similarly, if a court
`finds that a lawsuit, absent litigation misconduct, would
`have settled at a specific time—for example, when a party
`
`was legally required to disclose evidence fatal to its posi-
`
`
`
`
`
`
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`8
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`

`

`9
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` Cite as: 581 U. S. ____ (2017)
`
`Opinion of the Court
`tion—then the court may grant all fees incurred from that
`moment on. In each of those scenarios, a court escapes the
`grind of segregating individual expense items (a deposi-
`tion here, a motion there)—or even categories of such
`items (again, like expert discovery)—but only because all
`fees in the litigation, or a phase of it, meet the applicable
`test: They would not have been incurred except for the
`misconduct.
`
`
`
`
`III
`
`It is an oddity of this case that both sides agree with
`
`just about everything said in the last six paragraphs about
`the pertinent law. Do legal fees awarded under a court’s
`inherent sanctioning authority have to be compensatory
`rather than punitive when civil litigation procedures are
`used? The Haegers and Goodyear alike say yes. Does that
`mean the fees awarded must be causally related to the
`sanctioned party’s misconduct? A joint yes on that too.
`More specifically, does the appropriate causal test limit
`the fees, a la Fox, to those that would not have been in-
`
` curred but for the bad faith? No argument there either.
`And in an exceptional case, such as Chambers, could that
`test produce an award extending as far as all of the
`wronged party’s legal fees? Once again, agreement (if
`with differing degrees of enthusiasm). See Brief for Peti-
`tioner 17, 23–24, 31; Brief for Respondents 17–18, 22–23;
`Tr. of Oral Arg. 34–35, 46–47.
`
`All the parties really argue about here is what that law
`means for this case. Goodyear contends that it requires
`throwing out the trial court’s fee award and instructing
`the court to consider the matter anew. The Haegers main-
`tain, to the contrary, that the award can stand. They
`initially contend—pointing to a couple of passages from
`the Ninth Circuit’s opinion—that both courts below articu-
`lated and applied the very but-for causation standard we
`have laid out. See Brief for Respondents 17–18 (highlight-
`
`
`
`
`
`
`
`
`
`
`

`

`
`
` GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
`ing the Ninth Circuit’s statements that Goodyear’s “bad
`faith conduct caused significant harm” and that the Dis-
`trict Court “determine[d] the appropriate amount of fees to
`award as sanctions to compensate the [Haegers] for the
`damages they suffered as a result of [Goodyear’s] bad
`faith”). And even if we reject that view, the Haegers con-
`tinue, we may uphold the fee award on the ground that it
`
`in fact passes a but-for test. That standard is satisfied (so
`they say) for either of two reasons. First, because the case
`would have settled as soon as Goodyear disclosed the
`
`
`requested heat-test results, thus putting an end to the
`Haegers’ legal bills. Or second, because (settlement pro-
`spects aside) the withholding of that data so infected the
`lawsuit as to account for each and every expense the Hae-
`gers subsequently incurred. See id., at 14–15, 22, 26.
`
`The Haegers’ defense of the lower courts’ reasoning is a
`
`non-starter: Neither of them used the correct legal stand-
`ard. As earlier recounted, the District Court specifically
`disclaimed the “usual[ ]” need to find a “causal link” be-
`tween misconduct and fees when the sanctioned party’s
`behavior was bad enough—in the court’s words, when it
`
`“r[ose] to a truly egregious level.” 906 F. Supp. 2d, at 975
`
`
`(emphasis deleted); see supra, at 3. In such circumstances,
`the court thought, it could award “all” fees, including those
`that would have been incurred in the absence of the mis-
`conduct. 906 F. Supp. 2d, at 975. And the court confirmed
`that approach even while conceding that it might be
`wrong: By issuing a “contingent award” of $2 million,
`meant to go into effect if the Ninth Circuit demanded a
`causal “linkage between the misconduct and harm,” the
`District Court made clear that its primary, $2.7 million
`award was not so confined. App. to Pet. for Cert. 180a; see
`
`supra, at 4. Still, the Court of Appeals left the larger
`sanction in place, because it too mistook what findings
`were needed to support that award. In the Ninth Circuit’s
`view, the trial court could grant all attorney’s fees in-
`
`
`
`
`
`10
`
`
`
`
`

`

`
`
`
`
` 11
`
`
`
` Cite as: 581 U. S. ____ (2017)
`
`Opinion of the Court
`curred “during the time when [Goodyear was] acting in
`bad faith.” 813 F. 3d, at 1250 (emphasis added); see id., at
`1249 (permitting an award of fees incurred “once [Good-
`year] began flouting [its] discovery obligations” (emphasis
`added)); supra, at 4. But that is a temporal limitation, not
`a causal one; and, like the District Court’s “egregiousness”
`requirement, it is wide of the mark. A sanctioning court
`must determine which fees were incurred because of, and
`solely because of, the misconduct at issue (however seri-
`ous, or concurrent with a lawyer’s work, it might have
`been). No such finding lies behind the $2.7 million award
`
`made and affirmed below.
`
`Nor are we tempted to fill in that gap, as the Haegers
`have invited us to do. As an initial matter, the Haegers
`have not shown that this litigation would have settled as
`soon as Goodyear divulged the heat-test results (thus
`justifying an all-fees award from the moment it was sup-
`posed to disclose, see supra, at 8–9). Even the District
`Court did not go quite that far: In attempting to buttress
`its comprehensive award, it said only (and after express-
`ing “some uncertainty”) that the suit probably would have
`settled “much earlier.” 906 F. Supp. 2d, at 972. And that
`more limited finding is itself subject to grave doubt, even
`
`taking into account the deference owed to the trial court.
`As Judge Watford reasoned, the test results, although
`favorable to the Haegers’ version of events, did not deprive
`Goodyear of colorable defenses. In particular, Goodyear
`still could have argued, as it had from the beginning, that
`“the Haegers’ own tire, which had endured more than
`40,000 miles of wear and tear, failed because it struck
`
`road debris.” 813 F. 3d, at 1256 (dissenting opinion). And
`indeed, that is pretty much the course Goodyear took in
`another suit alleging that the G159 caused a motorhome
`accident. See Schalmo v. Goodyear, No. 51–2006–CA–
`2064–WS (Fla. Cir. Ct., 6th Cir., Pasco County). In that
`
`case (as Judge Watford again observed), Goodyear pro-
`
`
`
`
`
`
`
`

`

`
`
` GOODYEAR TIRE & RUBBER CO. v. HAEGER
`
`Opinion of the Court
`
`duced the very test results at issue here, yet still elected to
`
`
` go to trial. See 813 F. 3d, at 1256. So we do not think the
`
`record allows a finding, as would support the $2.7 million
`award, that disclosure of the heat-test results would have
`led straightaway to a settlement.
`Further, the Haegers cannot demonstrate that Good-
`
`year’s non-disclosure so permeated the suit as to make
`that misconduct a but-for cause of every subsequent legal
`expense, totaling the full $2.7 million. If nothing else, the
`District Court’s back-up fee award belies that theory.
`After introducing a causal element into the equation, the
`court found that the $700,000 of fees that the Haegers
`incurred in litigating against other defendants and prov-
`ing their own medical damages had nothing to do with
`Goodyear’s discovery decisions. See App. to Pet. for Cert.
`180a; supra, at 4. The Haegers have failed to offer
`any concrete reason for questioning that judgment, and we
`do not see how they could. At a minimum, then, the sanc-
`tion order could not force Goodyear to reimburse those
`expenses—because, again, the Haegers would have paid
`them even had the company behaved immaculately in
`every respect.
`
`That leaves the question whether the contingent $2
`million award should now stand—or, alternatively,
`
`whether the District Court must reconsider from scratch
`which fees to shift. In the absence of any waiver issue, we
`would insist on the latter course. A

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