A multi-office Squire Patton Boggs team led by partners Pierre Bergeron (Cincinnati), Gonzalo Martinez (San Francisco) and senior associate Lauren Kuley (Cincinnati) recently secured a victory before the U.S. Supreme Court in Goodyear Tire & Rubber Co. v. Haeger et al., which Mr. Bergeron argued before the Court in January. In a unanimous decision, the Court vacated a $2.7 million discovery sanction that was imposed under the district court’s inherent powers. The American Bar Association and the National Association of Manufacturers submitted amicus briefs in support of the client’s position.
After the Ninth Circuit upheld the sanctions in a 2-1 divided decision, Squire Patton Boggs convinced the Court to resolve a circuit split on the test that federal courts should use for determining monetary sanctions under their inherent powers. While some courts insisted on a causation test, others (like the Ninth Circuit) adopted a more malleable framework.
Justice Kagan, writing for the united Court, largely adopted the causation test that proposed by the firm: “A sanctioning court must determine which fees were incurred because of, and solely because of, the misconduct at issue[.]” This resolves a substantial question that had been left open by the Court’s Chambers decision 25 years ago and on which the lower courts were split. The Court’s ruling threw out the hefty discovery sanctions, among the largest ever imposed under a court’s inherent authority.
A copy of the Court’s opinion can be viewed here.