The title of this post is a bit complex. I apologize for that. But the topic is important. Sometimes, a party brings a case to federal court and the court later determines that it lacks subject matter jurisdiction. The case is then dismissed for lack of jurisdiction. What happens, however, when there is a sanctions motion pursuant to 28 U.S.C. §1927? Joining other circuits that have considered the issue, the 11th Circuit held that the district courts do indeed have jurisdiction to decide sanctions motions. This is important as it gives the court the power to discipline conduct and award sanctions even if there was no jurisdiction over the entire case. Obviously, I think the opinion is correct and well-reasoned.

The reasoning:

In the world of jurisdiction, there’s an important distinction between the underlying case or controversy and certain “collateral” matters. Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 395, 110 S.Ct. 2447, 110 L.Ed.2d 359 (1990). The former includes the merits of the dispute as well as many procedural questions. The latter includes a limited set of issues “collateral to the merits” of the case. Willy v. Coastal Corp., 503 U.S. 131, 137, 112 S.Ct. 1076, 117 L.Ed.2d 280 (1992). Think things like “the imposition of costs, attorney’s fees, and contempt sanctions.” Cooter & Gell, 496 U.S. at 396, 110 S.Ct. 2447.

Although we call these issues “collateral,” that doesn’t make them any less important. Many involve the power to enforce compliance with the rules and standards that keep the judiciary running smoothly. See Willy, 503 U.S. at 137, 139, 112 S.Ct. 1076. Without them, “abuses of the judicial system” would go unchecked, “burdening courts and individuals alike with needless expense and delay.” Cooter & Gell, 496 U.S. at 397-98, 110 S.Ct. 2447. And that’s not just a matter of procedure. Because justice delayed is justice denied, these powers ensure that justice is done.

The distinction between the underlying case and collateral issues is important when it comes to jurisdiction because it affects a court’s power to decide an issue. Once a court loses jurisdiction over a case, it may no longer decide issues arising out of that case. See, e.g., Capron v. Van Noorden, 6 U.S. (2 Cranch) 126, 127, 2 L.Ed. 229 (1804). But it can still decide certain “collateral” issues related to the case. See Cooter & Gell, 496 U.S. at 395, 110 S.Ct. 2447.

Here, all agree that the district court lacked subject-matter jurisdiction over the case. So the question for us is whether Irish’s motion for sanctions under the district court’s inherent powers or § 1927 was a part of the underlying case (which would mean that the court lacked the power to rule on the motion) or a “collateral” issue (which would mean that it had the power to do so).

Fortunately, we don’t approach this question on a blank slate. The Supreme Court has told us that sanctions under Federal Rule of Civil Procedure 11 are a “collateral” issue and thus a court may decide a Rule 11 sanctions motion even if it lacks jurisdiction over the underlying case. See Willy, 503 U.S. at 137-39, 112 S.Ct. 1076. The decision reasoned that exercising jurisdiction in this context was both constitutionally permissible and practically important.

On the first point, the Court explained that ruling on a Rule 11 motion “implicates no constitutional concern because it does not signify a district court’s assessment of the . . . legal merits” of the case. Id. at 138, 112 S.Ct. 1076 (cleaned up). Instead, it concerns “a collateral issue: whether the attorney has abused the judicial process.” Id. (cleaned up). And because a district court does not have to decide the merits to rule on a Rule 11 motion, it does not improperly consider the “`case or controversy’ over which it lacks jurisdiction.” Id.

On the second point, the Court reasoned that exercising jurisdiction over a Rule 11 motion is practically important because “[t]he interest in having rules of 1310*1310procedure obeyed” outlives the merits of a case. Id. at 139, 112 S.Ct. 1076. This makes sense. The need to deter those who might violate the rules does not rise or fall with any particular case. It is an ever-present need of all courts. Simply put, district courts need the power to rule on these issues to ensure “the maintenance of orderly procedure.” Id. at 137, 112 S.Ct. 1076.

Both these points apply equally to sanctions under a court’s inherent powers or § 1927. These sanctions, like Rule 11 sanctions, do not require a court to rule on the merits of the underlying case. Our analysis in the next Part makes this clear. And the purpose of the sanctions outlasts the end of the case. Otherwise, parties who abuse the judicial procedures could get off scot-free anytime it turned out that the district court lacked subject-matter jurisdiction.

For good reason, then, all of our sister circuits to have faced this question have recognized jurisdiction in this context. See, e.g., Ratliff v. Stewart, 508 F.3d 225, 231 n.7 (5th Cir. 2007); Red Carpet Studios Div. of Source Advantage, Ltd. v. Sater, 465 F.3d 642, 645 (6th Cir. 2006); In re Jaritz Indus., 151 F.3d 93, 96-97 (3d Cir. 1998); see also Fidrych v. Marriott Int’l, Inc., 952 F.3d 124, 137-38 (4th Cir. 2020); Zerger & Mauer LLP v. City of Greenwood, 751 F.3d 928, 931 (8th Cir. 2014).

Today, we join them and hold that a district court may address a sanctions motion based on its inherent powers or § 1927 even if it lacks jurisdiction over the underlying case.

Hyde v. Irish, 962 F.3d 1306 (11th Cir. 2020).

Comment: the court affirmed the denial of the sanctions motion.