Trita Parsi v. Seid Hassan Daioleslam , 778 F.3d 116 ( 2015 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued October 15, 2014 Decided February 10, 2015
No. 12-7111
TRITA PARSI AND NATIONAL IRANIAN AMERICAN COUNCIL,
APPELLANTS
v.
SEID HASSAN DAIOLESLAM,
APPELLEE
Appeal from the United States District Court
for the District of Columbia
(No. 1:08-cv-00705)
David A. Schlesinger argued the cause for appellants.
With him on the briefs was A.P. Pishevar.
HL Rogers argued the cause for appellee. With him on
the brief were Peter G. Jensen and Timothy E. Kapshandy.
Before: ROGERS and WILKINS, Circuit Judges, and
RANDOLPH, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge WILKINS.
WILKINS, Circuit Judge: Following an acrimonious,
three-year discovery process, the District Court awarded
$183,480.09 in monetary sanctions to Appellee Seid Hassan
2
Daioleslam 1 for attorney’s fees and expenses he accrued in
defending a defamation action brought by Appellants the
National Iranian American Council and Trita Parsi.
Throughout discovery, the Appellants engaged in a disturbing
pattern of delay and intransigence. Seemingly at every turn,
NIAC and Parsi deferred producing relevant documents,
withheld them, or denied their existence altogether. Many of
these documents went to the heart of Daioleslam’s defense.
The Appellants’ failure to produce documents in a timely
manner forced Daioleslam—whom they had haled into
court—to waste resources and time deposing multiple
witnesses and subpoenaing third parties for emails the
Appellants should have turned over. Even worse, the
Appellants also misrepresented to the District Court that they
did not possess key documents Daioleslam sought. Most
troublingly, they flouted multiple court orders.
Although we discuss these penalties individually below,
all implicate an enduring issue: the power of a district court
to sanction those who disobey its instructions and interfere
with its proceedings. We have previously recognized a trial
judge’s authority to punish and deter abuses of the discovery
process, and we do so again today. A court without the
authority to sanction conduct that so plainly abuses the
judicial process cannot function. We affirm the bulk of the
District Court’s sanctions as the wages of Appellants’
dilatory, dishonest, and intransigent conduct, though in a
couple of minor respects, we reverse and remand for
reconsideration under the proper standard.
1
Daioleslam’s filings below and his brief before this Court indicate
that his given name is “Seid Hassan Daioleslam” or “Hassan
Daioleslam,” not “Daioleslam Seid Hassan,” as the complaint
initially alleged. J.A. 66 n.1; Appellee’s Br. at 1.
3
I.
This appeal is brought by plaintiffs below, the National
Iranian American Council (“NIAC”), a Washington-based
nonprofit “dedicated to promoting Iranian American
involvement in American civic life,” and its president and co-
founder Trita Parsi, an expert in United States-Iran relations
who has published extensively on the subject. J.A. 20-21, 73,
77-78, 102. Daioleslam, the defendant below, is a resident of
Arizona who publishes a website called Iranianlobby.com.
J.A. 20-21.
In April 2008, the Appellants filed a complaint alleging
Daioleslam defamed them in a series of articles and blog posts
claiming that they had secretly lobbied on behalf of the
Iranian regime in the United States. See J.A. 19-28. 2 The
Appellants alleged that Daioleslam’s conduct had damaged
their reputations and harmed public support for NIAC. J.A.
25, 27. In February 2009, the District Court denied
Daioleslam’s motion to dismiss, but concluded that NIAC and
Parsi were limited public figures and would be required to
prove Daioleslam acted with actual malice, which the
Appellants could demonstrate through evidence of what
Daioleslam knew at the time he authored the statements about
them. Parsi v. Daioleslam, 595 F. Supp. 2d 99, 104-08
2
Daioleslam alleged that NIAC and Parsi were “key players in the
lobby enterprise of Tehran’s ayatollahs in the United States,” that
the organization had “strong connections to the inner circles of
power in Tehran” and “the specific role of lobbying the US
Congress by utilizing unwary ordinary Iranian Americans
concerned about their inborn land,” that the Appellants were
“effective nodes of Tehran’s efforts to manipulate US policy
toward self-serving ends,” and that NIAC was “an active and
disguised Washington-based lobbying enterprise for the Iranian
theocratic regime.” J.A. 21-23, 26.
4
(D.D.C. 2009). The court also held that Daioleslam had
offered insufficient evidence to show his assertions were
substantially true, which would constitute a complete defense
to the Appellants’ defamation claim. Id. at 108-09. It
therefore determined that additional discovery was required
“to develop [these] aspects of [the case].” Id. at 103.
Shortly thereafter, Daioleslam served NIAC with his first
request for production, seeking various documents, including
those “relating to United States political officials” and
“referring to NIAC’s activities as lobbying, exercising
political influence, taking positions on United States policies,
or persuading United States political officials.” J.A. 935-36.
In a second request for production, served in March 2009,
Daioleslam sought all documents “relating to NIAC
membership, including all communications with . . .
members, and membership and email lists,” and “[a]ll
calendars, diaries, or other documents relating to the time-
keeping records of NIAC and its employees.” J.A. 999-1000.
Both requests defined “document” to include “agendas,
minutes or notes of conferences [and] meetings, . . . calendars,
diaries, and appointment books . . . [and] electronic mail.”
J.A. 931, 996.
During discovery, the parties traded recriminations over
NIAC’s apparent failure to produce documents responsive to
several of Daioleslam’s requests for production. Between
July 2010 and August 2011, the District Court issued three
orders compelling NIAC to produce certain documents and
parts of its computer network. In September 2011,
Daioleslam moved for sanctions against the Appellants and
for summary judgment. The court subsequently entered
summary judgment in Daioleslam’s favor. Parsi v.
Daioleslam, 890 F. Supp. 2d 77 (D.D.C. 2012). The
5
Appellants do not appeal the disposal of the merits of their
case on summary judgment.
On the same day it granted summary judgment on the
merits, the District Court imposed sanctions against the
Appellants for their discovery abuses. See Parsi v.
Daioleslam, 286 F.R.D. 73 (D.D.C. 2012) (the “Sanctions
Order”). On April 9, 2013, the court entered a final judgment
in favor of Daioleslam, plus judgment in the amount of
$183,480.09 for the sanctions, with post-judgment interest
running from the date of the Sanctions Order, which had been
entered September 13, 2012. J.A. 926; see also Parsi v.
Daioleslam, 937 F. Supp. 2d 44 (D.D.C. 2013) (the “Final
Order”). In awarding sanctions, the District Court invoked
both Rule 37 of the Federal Rules of Civil Procedure and its
inherent authority. Parsi, 286 F.R.D. at 77. It noted that Rule
37(a) embraces monetary sanctions for the prevailing party on
a motion to compel, and cited to Rule 37(b), which penalizes
disobedience of a court order. Id. (citing FED. R. CIV. P.
37(a), (b)(2)(A)). The court concluded that, under our
precedent, it could impose “‘issue-related’ sanctions” under
its inherent authority based on a finding that a party engaged
in misconduct by a preponderance of the evidence, rather than
the higher clear and convincing evidence standard. Id.
(quoting Shepherd v. Am. Broadcasting Cos., Inc., 62 F.3d
1469, 1478 (D.C. Cir. 1995)). Before reviewing the legal
merit of the Appellants’ arguments, we summarize the
conduct for which the District Court imposed sanctions.
A.
Although it used Microsoft Outlook as its email client,
NIAC failed for ten months to produce Outlook calendar
records for any of its employees in response to Daioleslam’s
production requests. In early December 2009, Daioleslam
6
deposed NIAC’s former legislative policy director Emily
Blout, who testified that she had not understood his discovery
requests to include calendar entries from Outlook. J.A. 957.
The next day, Daioleslam requested that NIAC review its
calendars and produce entries responsive to his requests. J.A.
1050. Only at the end of that month did NIAC produce about
400 Outlook calendar entries for three of its employees.
Although it claimed to have put a litigation hold in place,
NIAC produced no calendar entries from before 2009. Of the
entries it produced, 78 had been altered shortly before
production, including two-thirds of those in Parsi’s calendar. 3
In early March 2010, Daioleslam asked the District Court
to order NIAC to produce its Outlook calendar records for a
forensic imaging to determine when they were modified,
arguing that the multiple alterations shortly before production
raised questions about the sufficiency of NIAC’s compliance
with its discovery obligations. J.A. 133-36. NIAC responded
that it had not modified the Outlook entries, and promised the
court that it would produce “complete, unaltered” calendar
entries for its employees. Parsi, 286 F.R.D. at 79; see J.A.
142. The court therefore did not order the requested forensic
imaging. Parsi, 286 F.R.D. at 79. Yet when NIAC made a
3
The list of produced calendar entries Daioleslam attached as an
exhibit to his motion to compel lists only 345 documents, 81 of
them modified over the weekend between Christmas and December
27, 2009. See J.A. 135, 963-985. Daioleslam later represented that
NIAC had produced 412 documents, of which 78 were altered
during that period, and the District Court appears to have accepted
this figure but mistakenly transcribed the number of altered
documents as “87.” J.A. 188; see Parsi, 286 F.R.D. at 79. NIAC
never disputed the totals that Daioleslam alleged, and even if the
earlier numbers were accurate, they still demonstrate that a large
proportion of the documents were modified shortly before
production.
7
second production, in April 2010, it consisted solely of
Outlook calendar entries copied onto a spreadsheet and did
not include a field stating when the entries had last been
modified. J.A. 190.
Seeking resolution of the issue, the District Court issued
an order on July 1, 2010 (the “July 2010 Order”) directing
NIAC to “submit the server on which its Outlook calendars
are kept to PricewaterhouseCoopers [“PwC”] for forensic
imaging” by July 16. J.A. 168. It ordered PwC to produce
the Outlook calendar entries “complete and unedited to the
extent possible” to Daioleslam, J.A. 168, and to prepare a
report describing any calendar entries found on the forensic
image and omitted from NIAC’s prior productions, as well as
details of any edits or deletions to the entries. J.A. 169. 4
Instead of producing a server, however, NIAC produced
eight desktop computers and a laptop and told the District
Court, for the first time, that it did not have a server. J.A.
236, 239. 5 PwC’s forensic analysis subsequently revealed the
existence of four additional computers in NIAC’s network
that it had not produced. J.A. 261-62. The Appellants
claimed that these computers were used only by interns. J.A.
271-72. Daioleslam then subpoenaed NIAC’s “computer
consultant,” Progressive Office, which produced an inventory
4
The court ordered Daioleslam to pay for PwC’s analysis, but
stated that he could file a motion to recover his expenses if the
report showed that “discoverable calendar entries were omitted
from previous productions, or that inappropriate edits were made to
such entries.” J.A. 169.
5
In fact, David Elliott, NIAC’s employee responsible for e-
discovery, had testified in an October 2009 deposition that the
organization collected electronic documents for discovery on an
“electronic server.” JA. 435-36, 1227-28.
8
it had created during its late 2009 audit of NIAC’s network. 6
See J.A. 297, 1113-39. The inventory showed that one of the
computers NIAC had withheld as an “intern computer” was
actually used by Blout, whose Outlook calendar entries NIAC
had produced. J.A. 297, 369. Compare J.A. 1059 (inventory
listing “Intern Computer”), with J.A. 1125-26 (same computer
listed as “Computer Name: niac-emily”). 7 Another one of the
“intern” computers was actually used by NIAC’s co-founder
and former outreach director, Babak Talebi. Compare J.A.
1245 (listing “Intern Computer”) with J.A. 1248 (NIAC letter
acknowledging identical serial number corresponded to
Talebi’s computer).
Progressive Office’s network inventory also raised
questions about Parsi’s honesty regarding his laptop and
desktop computers. The desktop computer that NIAC
produced that Parsi represented to the District Court he had
used from April 2009 until November 2010 was not
connected to NIAC’s network at all when Progressive Office
6
NIAC denied that Progressive Office had performed work on its
network apart from addressing a printing malfunction, and claimed
it had produced an inaccurate list of NIAC’s computer serial
numbers because it lacked sufficient knowledge of the network.
J.A. 311-12. However, Progressive Office CEO Stuart Kushner
submitted an affidavit and supplied email traffic between
Progressive Office and NIAC revealing that Progressive Office did
extensive work for NIAC, including a “network audit and survey,”
between November 2009 and April 2010. J.A. 1061. Kushner also
stated that he had installed NIAC’s “new, larger server” and
migrated data from its “old, existing server.” Id. (emphasis added);
see J.A. 1093-94, 1109.
7
Later, NIAC dismissed the concern that Blout may have used one
of the computers it failed to produce, arguing that as a small
organization, NIAC’s employees often shared computers, but the
District Court rejoined that any computer used by Blout, NIAC’s
legislative director, was relevant to the imaging. See J.A. 373.
9
worked on NIAC’s network between November 2009 and
April 2010. Parsi, 286 F.R.D. at 85-86; J.A. 261-63, 1061.
PwC’s analysis also showed that Parsi had stopped using
Outlook in June 2010 and stopped using the desktop
altogether in August of that year. Parsi, 286 F.R.D. at 86.
Parsi also represented that his laptop computer had been
stolen in Norway in early 2010, and he had not backed up the
hard drive beforehand, despite being subject to a litigation
hold. J.A. 239-40, 436.
In a March 29, 2011 order (the “March 2011 Order”), the
District Court again ordered NIAC and Parsi to produce the
“server (or ‘shared drive’)” that contained “NIAC’s Outlook
calendar entries that this Court ordered be produced in July
2010” for forensic imaging. J.A. 330. For the avoidance of
doubt, the court stated that if NIAC did not produce a server
or “shared drive” by that date, it must instead turn over the
four computers it had previously failed to produce and the
desktop computer Parsi used in 2008. Id. The court
instructed PwC to forensically image Outlook calendar entries
on whatever machines NIAC produced, should Daioleslam
choose to proceed with another imaging.
In April 2011, NIAC produced a new server containing
four hard drives that it had installed in December 2009, but
refused to produce the original server in use at the time it had
uploaded discovery materials. J.A. 437. Daioleslam
expressed his concern that NIAC might not have migrated all
the data from its old server to the new one. J.A. 415. He
again moved to compel NIAC to produce its old server and
Talebi’s previously withheld computer, J.A. 435-38, 585-88,
and NIAC reacted angrily to what it termed a “third bite at the
imaging apple.” J.A. 499.
10
At an August 30, 2011 hearing, the District Court
expressed its frustration with the Appellants’ continued
defiance of its orders. J.A. 557-58. It then issued a third
order (the “August 2011 Order”) requiring that the Appellants
produce “all of the servers/shared-drives on which NIAC’s
Outlook calendar entries have been kept from 2007 to the
present,” including its old server. J.A. 595. PwC was
instructed, at Daioleslam’s election, to conduct a third
forensic imaging, limited to Outlook calendar information and
“user/habit/login information in order to determine the
identities of the persons who used the computers’ Outlook
calendar function.” J.A. 596. The court ordered NIAC to pay
Daioleslam’s expenses associated with bringing his third
motion to compel, as it was “the third time that plaintiffs have
been ordered to produce their server[,] a server that plaintiffs
initially claimed did not exist.” J.A. 596. PwC’s forensic
imaging of NIAC’s old server revealed hundreds of
previously unproduced calendar entries. Parsi, 286 F.R.D. at
78.
In its Sanctions Order, the District Court concluded that
NIAC had violated its July 2010 and March 2011 Orders.
Even if it did not possess a “server,” the court pointed out,
NIAC was obligated to produce all the computers on which it
stored relevant data for the first forensic imaging. Id. at 78-
79. Since its disobedience to the court’s July 2010 Order had
necessitated two additional rounds of imaging, NIAC must
pay for those later rounds. Id. The court also ordered NIAC
to pay Daioleslam’s reasonable expenses in bringing that part
of his motion for sanctions.
The court did not find that NIAC had inappropriately
altered Outlook calendar entries. Id. at 79-83. However, it
ordered NIAC to pay half the cost of re-deposing Blout, since
at the time Daioleslam first deposed her in December 2009,
11
NIAC had produced none of her calendar entries, which were
key to questioning her about meetings with legislative and
executive officials. Id. at 85.
With respect to Parsi’s computers, the District Court
awarded sanctions for the part of Daioleslam’s sanctions
motion related to Parsi’s misrepresentation in an interrogatory
response about his use of a desktop computer on NIAC’s
network. Id. at 86-87. The court noted, however, that the
Appellants had not discussed the issue at all in their briefing,
and there was a risk the court might be “awarding sanctions
based on conduct for which there is an innocent explanation.”
Id. at 86. 8
8
Another episode resulted in sanctions that NIAC and Parsi do not
appeal. NIAC produced virtually no documents from Talebi’s
NIAC email address in response to Daioleslam’s production
requests prior to late December 2009, even though Talebi had been
involved with the organization since 2002; the Appellants claimed
the email records “no longer exist[ed].” J.A. 144. After the court
ordered NIAC to search its servers, NIAC located about 8,000 of
his emails, but produced only 89 as relevant, and withheld the rest
as not relevant. J.A. 151-52. Daioleslam argued it was difficult to
believe that such a small proportion of NIAC’s former outreach
director’s emails were relevant, given that his production request
called for all emails to NIAC members. The District Court ordered
NIAC to turn over Talebi’s emails “consistent with its discovery
obligations.” J.A. 212. NIAC then produced about 2,500 additional
Talebi emails, withholding the remaining 5,500 as nonresponsive.
J.A. 334.
Given the still-low rate of emails NIAC produced, in March
2011 the District Court agreed to review the emails itself in camera.
J.A. 331-32. After review, the court held in an April 5, 2011 order
that NIAC had “totally failed” to assess the Talebi emails for
responsiveness. J.A. 333-35. The court observed that many were
plainly responsive to Daioleslam’s requests for lobbying-related
documents, including an email from Talebi explaining that NIAC
12
B.
References to “SF” in NIAC’s belated April 2010
production of some of its Outlook calendar entries tipped off
Daioleslam that it had also withheld meeting notes and
membership lists it kept in a program called Salesforce. 9 See
Exhibit HH to Motion for Sanctions at 2, Parsi v. Daioleslam,
No. 1:08-cv-00705 (D.D.C. Sept. 16, 2011), ECF No. 143
(listing a September 2008 Outlook meeting invitation from
Parsi to Blout and NIAC assistant legislative director Patrick
Disney entitled “How to freakin [sic] use SF,” and the body of
which stated “Need to go over how you all should enter in
your meeting notes”). When Daioleslam drew the District
Court’s attention to the possibility that NIAC had withheld its
system for tracking meetings with legislators, NIAC
responded that it “ha[d] not employed any such software or
“can ‘advocate’ but not ‘lobby’” and an explanation of NIAC’s
“seven ingredients to influence lawmakers.” J.A. 334. When
Daioleslam finally received the remainder of Talebi’s emails, he
noted they included Congress-related communications that he could
have used in his depositions of NIAC’s employees. J.A. 614-17.
The court ordered NIAC to pay Daioleslam’s reasonable
expenses in moving to compel production of the emails, finding
NIAC was not “substantially justified” in opposing the motion,
since it failed to conduct even a cursory relevance review of the
emails it withheld. Parsi, 286 F.R.D. at 83.
9
NIAC produced member lists from December 2007 and April
2008 in May 2009, which Daioleslam considered insufficient to
comply with his request for “communications with potential,
former, or current members” as of his March 2009 discovery
request. J.A. 999. Daioleslam argued NIAC’s more recent
membership data was relevant in view of its allegation that his
articles “interfered [sic] or damaged the public support of NIAC by
affecting NIAC’s public estimation and reputation” and its damages
expert’s plan to testify that the articles led to a drop in current
membership numbers. J.A. 27, 442-43.
13
system and is therefore unable to comment about this
unfounded claim.” J.A. 207.
By September 2010, Daioleslam realized that “SF”
probably referred to a software program called “Salesforce,”
and again asked NIAC to produce its membership data; this
time, NIAC told the District Court that it had only
experimented briefly with Salesforce. J.A. 237-38, 242-43.
However, Parsi conceded in his first deposition two months
later that NIAC had used Salesforce “to keep track on
members and donations” since before 2006 and that, “for a
few years, we used it as the database in which we kept our
membership information.” Exhibit MM to Motion for
Sanctions at 5, Parsi, ECF No. 143. He testified that NIAC
migrated its membership database to a program called Convio
in early 2010. See id. at 6-7.
Yet by December 2010, NIAC had still not produced any
Salesforce or Convio data. J.A. 258-61. NIAC by that time
acknowledged that it had also used the program to track
meeting notes, which it promised to turn over, but refused to
produce membership information, which it referred to as both
“proprietary” and “duplicative.” J.A. 272-75. On December
22, 2010, the District Court ordered the parties to preserve
electronically stored information “possessed by the parties or
under their control since the commencement of the litigation
until final resolution.” J.A. 251.
NIAC finally produced its Salesforce meeting notes in
February 2011, and a month later produced some Microsoft
Excel spreadsheets showing its Salesforce “membership
information”; the Excel files’ metadata showed they were
nearly a year old and many of the fields were coded and
unreadable. J.A. 445, 624. The District Court’s March 2011
Order required NIAC to produce its entire current Convio
14
membership list and codes for the Salesforce data. J.A. 331.
The court also permitted Daioleslam to re-depose Parsi.
Much of Parsi’s second deposition that May focused on his
conflicting statements about NIAC’s membership numbers
and unwillingness to turn over NIAC’s mailing list, which he
testified ran to over 43,000 members. Exhibit A to Motion to
Compel Production of Membership Lists at 5, Parsi, No.
1:08-cv-00705 (D.D.C. July 1, 2011), ECF No. 113. Again,
NIAC failed to comply meaningfully with the court’s order,
producing only a list of 9,000 Convio “transactions”—mostly
donations—from which a complete list of members was
impossible to divine. J.A. 446-47.
In July 2011, Daioleslam once more moved to compel
NIAC to produce its complete list of active paid and former
members. J.A. 451. In its August 2011 Order, the District
Court again ordered NIAC to produce its complete Convio list
of both active and expired members, “current as of the date
that it is produced,” and ordered the Appellants to pay
Daioleslam’s costs in bringing that part of his motion to
compel, because it was the second time he had sought the
documents. J.A. 596-97. At long last, in September 2011—
two-and-a-half years after Daioleslam’s request for
production of documents related to NIAC’s membership—
NIAC produced all its member lists. J.A. 624.
Given that NIAC withheld its complete membership data
until months after Parsi’s second deposition, Daioleslam
moved for an award of his expenses in deposing Parsi over
two-and-a-half days in December 2009 and May 2011. J.A.
639. In its Sanctions Order, the District Court awarded
Daioleslam half his expenses for the final, partial day of
Parsi’s deposition only, since he would have had to depose
Parsi anyway and the court could not determine whether the
length of the final day’s deposition resulted from NIAC’s
15
belated production or would have taken that long in any
event. Parsi, 286 F.R.D. at 85. The court awarded
Daioleslam the expense of bringing that part of the motion.
Id.
C.
Because of Appellants’ failure to produce relevant
documents in response to his requests for production,
Daioleslam also subpoenaed a series of third parties for
documents in their custody. These subpoenas turned up
multiple relevant documents NIAC had failed to produce,
including a discussion of legal restrictions on lobbying by
nonprofits, emails Parsi wrote to a National Security Council
director, emails coordinating a congressional briefing,
communications NIAC exchanged with its expert about NIAC
events on Capitol Hill and meetings with foreign officials, and
168 emails NIAC received from Iranian-Americans
expressing negative views of the organization. J.A. 618-20.
The Appellants made no attempt to defend their failure to
produce these documents other than to say Daioleslam had
found no “smoking gun” among them. J.A. 711.
The District Court awarded Daioleslam his expenses in
subpoenaing nearly all of these third parties, calling NIAC’s
suppression of documents “inexplicable and unexplained” and
“indefensible.” Parsi, 286 F.R.D. at 84. “Most
disturbingly,” the court found, the Appellants had
misrepresented in a hearing that “technical” reasons prevented
them from producing the critical emails from Iranian-
Americans, but Appellants were able to gather them for their
own damages expert. Id.
Finally, Daioleslam sought sanctions for Parsi’s alteration
of a document he produced in discovery. The document, a list
16
of frequently asked questions (“FAQ”) compiled by Iranians
for International Cooperation (“IIC”) (a group with which
Parsi was affiliated before launching NIAC), originally
described IIC as a “lobby” group. Id. at 87. One version of
the FAQ that Parsi produced—the metadata of which showed
it was last modified in 1999—retained this description. The
second version he produced replaced the word “lobby” with
“advocacy,” and had last been modified in April 2009. Id.
Parsi responded only that he was unaware of the alteration.
J.A. 715-16. The court indicated it “would not be prepared to
find by clear and convincing evidence that plaintiffs
intentionally altered this file,” but was prepared to do so by a
preponderance of the evidence. Parsi, 286 F.R.D. at 87.
Accordingly, it awarded as sanction Daioleslam’s expenses in
preparing the corresponding part of his sanctions motion.
D.
Daioleslam thereafter submitted a final bill of costs
totaling $280,786.36 for the court-ordered expense
reimbursements. J.A. 898-901. On April 8, 2013, the court
issued an opinion awarding him $183,480.09, after rejecting
some of his attorneys’ and their non-legal employees’ vague
billing descriptions, J.A. 908-12, 917-23, and subtracting
certain forensic imaging charges not attributable to NIAC’s
dilatory tactics. J.A. 912-17. The court also awarded costs to
Daioleslam as the prevailing party under Rule 54(d). J.A.
923-24. In its Final Order issued April 9, 2013, the court
entered post-judgment interest on the full award to run from
September 13, 2012, the date it had ordered sanctions. J.A.
926. NIAC and Parsi timely filed this appeal.
NIAC and Parsi appeal several of the District Court’s
sanctions: (i) Daioleslam’s expenses in preparing his third
motion to compel forensic imaging; (ii) the cost of the second
17
and third forensic imagings; (iii) the cost of re-deposing Parsi
and Blout; (iv) the expense of subpoenaing third parties; (v)
the cost of preparing the parts of Daioleslam’s sanctions
motion related to Parsi’s alteration of the IIC document and
Parsi’s purportedly false interrogatory responses; and (vi) the
court’s award of sanctions to run from the date of the District
Court’s Sanctions Order rather than final judgment.
II.
District courts have “considerable discretion” in
managing discovery, United States v. Philip Morris Inc., 347
F.3d 951, 955 (D.C. Cir. 2003), and possess broad discretion
to impose sanctions for discovery violations under Rule 37.
Bonds v. District of Columbia, 93 F.3d 801, 807 (D.C. Cir.
1996) (citing Nat’l Hockey League v. Metro. Hockey Club,
Inc., 427 U.S. 639, 642-43 (1976) (per curiam)).
Consequently, we review discovery-related orders for abuse
of discretion, a “narrowly circumscribed” scope of review.
Lee v. Dep’t of Justice, 413 F.3d 53, 59 (D.C. Cir. 2005); see
also Bonds, 93 F.3d at 807 (reviewing court may reverse
discovery sanctions only if “clearly unreasonable, arbitrary, or
fanciful”) (quoting Hull v. Eaton Corp., 825 F.2d 448, 452
(D.C. Cir. 1987) (per curiam)).
We review for clear error the District Court’s finding that
Appellants acted in bad faith sufficient to justify an award of
attorney’s fees under the court’s inherent power. Ass’n of Am.
Physicians and Surgeons, Inc. v. Clinton, 187 F.3d 655, 660
(D.C. Cir. 1999); Am. Hosp. Ass’n v. Sullivan, 938 F.2d 216,
222 (D.C. Cir. 1991). This is a “highly deferential” standard.
Shepherd, 62 F.3d at 1475-76.
Ordinarily, a court of appeals can affirm a district court
judgment on any basis supported by the record, even if
18
different from the grounds the district court cited. Queen v.
Schultz, 747 F.3d 879, 884 (D.C. Cir. 2014). However, in
Manion v. American Airlines, we declined to affirm sanctions
on any basis other than that articulated by the district court.
395 F.3d 428, 431-32 (D.C. Cir. 2004). 10 Here, the District
Court expressly anchored its sanctions in two sources of
judicial power—Rule 37 and the inherent power of courts—
and we will only affirm if it correctly exercised these powers,
notwithstanding Daioleslam’s invitation to consider other
bases of authority. See Appellee’s Br. at 52-54.
As relevant here, two subdivisions of Rule 37 of the
Federal Rules of Civil Procedure permit a district court to
award monetary sanctions for a party’s reasonable expenses
caused by its opponent’s resistance to discovery. We
conclude the District Court was well within its discretion in
sanctioning the Appellants under Rule 37.
A.
First, Appellants contend the District Court abused its
discretion by awarding Daioleslam’s expenses in bringing
10
In Manion, since the district court had explicitly entered
sanctions under 28 U.S.C. § 1927, this Court refused to consider
whether it could have done so under its inherent authority, and
suggested that, since district courts possess extensive discretion
over sanctions, we could only “invoke an alternative basis to affirm
[if] . . . it would have been an abuse of discretion for the trial court
to rule otherwise.” 395 F.3d at 431 (quoting Ashby v. McKenna,
331 F.3d 1148, 1151 (10th Cir. 2003)) (internal quotation marks
omitted). Daioleslam misreads this exception: the Court can affirm
sanctions on another basis if it would have been an abuse of
discretion for the District Court not to order sanctions, not if “it
would not have been an abuse of discretion to sanction” a party for
its behavior. See Appellee’s Br. at 54 n.22.
19
three motions to compel NIAC to produce its server, asserting
that their opposition to those motions was “substantially
justified.” In fact, however, the court only shifted the cost of
Daioleslam’s third motion to compel. This cost-shifting was
proper under Rule 37(a)(5)(A).
Under Rule 37(a), a party can move for an order to
compel disclosure or discovery after first attempting in good
faith to confer with its opponent. FED. R. CIV. P. 37(a)(1).
Upon granting a motion to compel discovery, a court must
order the opposing party to pay the moving party’s
“reasonable expenses incurred in making the motion,
including attorney’s fees,” unless the opposing party was
“substantially justified” in its resistance to discovery, the
prevailing party did not attempt to obtain discovery in good
faith before moving to compel, or an expense award would be
otherwise unjust. FED. R. CIV. P. 37(a)(5)(A). 11 If a court
grants in part and denies in part a motion to compel, it may
apportion reasonable expenses among the parties accordingly.
FED. R. CIV. P. 37(a)(5)(C).
A party is “substantially justified” in opposing discovery
or disobeying an order “if there is a ‘genuine dispute,’ or ‘if
reasonable people could differ as to the appropriateness of the
contested action.’” Pierce v. Underwood, 487 U.S. 552, 565
(1988) (internal citations and brackets omitted); see, e.g.,
Maddow v. Procter & Gamble Co., 107 F.3d 846, 853 (11th
Cir. 1997) (party was substantially justified in opposing
motion to compel production where it believed case law
11
The Advisory Committee Notes explain that the command that a
court “must” award expenses “does not significantly narrow the
discretion of the court,” but is intended to encourage use of this
“most important available sanction to deter abusive resort to the
judiciary.” FED. R. CIV. P. 37 advisory committee’s note to 1970
amendment.
20
supported its position). 12 The substantial justification
requirement serves to prevent sanctions that “‘chill’ legitimate
efforts at discovery.” Reygo Pac. Corp. v. Johnston Pump
Co., 680 F.2d 647, 649 (9th Cir. 1982).
Reasonable people cannot differ about whether a party is
entitled to withhold relevant documents without articulating
any claim of privilege. NIAC’s calendar entries were relevant
to proving Daioleslam’s defense, in that they might reveal
meetings with officials that suggested the truth of his
allegedly defamatory statements. See FED. R. CIV. P. 26(b)(1)
(“Parties may obtain discovery regarding any nonprivileged
matter that is relevant to any party’s claim or defense . . . .”).
The Appellants argue that the District Court’s ultimate
conclusion that they had not deleted emails in bad faith
demonstrates the reasonableness of their position, see
Appellants’ Br. at 60, but this Court cannot ground its review
in hindsight. Evidence that suggested some entries were
12
The 1970 Amendment Advisory Committee Notes to Rule 37
explain the rationale behind this exemption from mandatory
sanctions:
On many occasions, to be sure, the dispute over
discovery between the parties is genuine, though
ultimately resolved one way or the other by the
court. In such cases, the losing party is substantially
justified in carrying the matter to court. But the
rules should deter the abuse implicit in carrying or
forcing a discovery dispute to court when no
genuine dispute exists. And the potential or actual
imposition of expenses is virtually the sole formal
sanction in the rules to deter a party from pressing
to a court hearing frivolous . . . objections to
discovery.
FED. R. CIV. P. 37 advisory committee’s note to 1970 amendment.
21
modified or deleted before production justified the District
Court’s order that NIAC submit its server for imaging.
The Appellants also argue their opposition to producing
their server was justified by Daioleslam’s “leaks” of NIAC
documents to media outlets. See Appellants’ Br. at 58. If the
Appellants were concerned Daioleslam would misappropriate
their calendar data, they could have filed for a protective
order. See FED. R. CIV. P. 26(c). They acknowledge none
was in place at the time of their refusal to allow PwC to image
NIAC’s server. And if they feared that the court’s order
would “allow Daioleslam to image [NIAC’s] CPUs and
shared drives,” bearing all their internal records for him to
see, Appellant’s Br. at 58-59, the appropriate remedy was to
require the third-party that conducted the imaging to employ
certain safeguards. This is precisely what the District Court
did; its first order designated PwC to conduct the imaging and
produce only calendar entries to Daioleslam, specifically
protecting NIAC from “metadata mining” of its server. J.A.
169. NIAC’s position was therefore unreasonable at the time
the court issued its first, July 2010 Order.
We need not even decide, however, whether the
Appellants were substantially justified in opposing the July
2010 Order, since the District Court did not shift the cost of
obtaining that order to the Appellants. In fact, as Daioleslam
notes, the court did not even shift the cost of obtaining the
second motion to compel NIAC’s server, contrary to the
Appellants’ claim. See Appellee’s Br. at 37. Instead, it only
shifted the cost of the third motion to compel. After the court
rejected their arguments and ordered discovery of the calendar
data, the Appellants were not entitled to continue to oppose
production. The Appellants’ brief proceeds from the
assumption that Daioleslam’s second and third motions to
compel each gave them an additional opportunity to contest
22
whether NIAC’s Outlook calendar data was subject to
imaging. Not so. Once the court resolved the discoverability
of that data, no genuine dispute remained and NIAC was not
at liberty to continue to litigate the issue. Whatever the merits
of NIAC’s opposition to the first motion to compel, its mere
obstinacy became contumacy when it failed to obey two
subsequent direct court orders.
B.
1.
The largest component of the sanctions award consisted
of Daioleslam’s expenses for the second and third imaging of
NIAC’s hard drive. Once more, the District Court properly
exercised its discretion, because the cost of these forensic
imagings directly resulted from NIAC’s disobedience of the
court’s initial, July 2010 Order.
Rule 37(b) provides that a district court may issue “just
orders” entering sanctions against a party that “fails to obey
an order to provide or permit discovery,” including an order
granting a motion to compel. FED. R. CIV. P. 37(b)(2)(A).
Sanctions can include (but are not limited to) directing that
matters addressed by the order violated be taken as
established, prohibiting the disobedient party from
introducing evidence, striking pleadings, staying the action
pending obedience, dismissing the action, entering default
judgment, or holding the disobedient party in contempt. FED.
R. CIV. P. 37(b)(2)(A). In addition, “the court must order the
disobedient party, the attorney advising that party, or both to
pay the reasonable expenses, including attorney’s fees, caused
by the failure” to obey a discovery order, unless the party’s
disobedience was substantially justified or the circumstances
would otherwise render an expense award unjust. FED. R.
23
CIV. P. 37(b)(2)(C). 13 As Rule 37(b)’s text suggests, “[a]
production order is generally needed to trigger” sanctions.
Shepherd, 62 F.3d at 1474 (alteration in original) (quoting
Att’y Gen. v. The Irish People, Inc., 684 F.2d 928, 951 n.129
(D.C. Cir. 1982)).
The cost of the imagings was “caused by [NIAC’s]
failure” to obey the July 2010 Order by producing all the
computers on which it stored calendar records. See FED. R.
CIV. P. 37(b)(2)(C). NIAC elevates semantics over substance,
arguing it could not comply with the command that it produce
a “server” because it used only a “shared hard drive” to store
data, not a central exchange server. 14 Appellants’ Br. at 4, 25,
35, 52-53, 61. The context of the District Court’s July 2010
Order is key, however. That order required NIAC to “submit
the server on which its Outlook calendars are kept to . . .
13
The 1970 Advisory Committee Notes observe that awarding
reasonable expenses caused by the failure to obey a discovery order
“places the burden on the disobedient party to avoid expenses by
showing that his failure is justified or that special circumstances
make an award of expenses unjust. Allocating the burden in this
way . . . is particularly appropriate when a court order is
disobeyed.” FED. R. CIV. P. 37 advisory committee’s note to 1970
amendment.
14
Even were we to credit the Appellants’ argument that NIAC
could not comply because it did not have a server, its behavior is
inconsistent with that assertion. At no point in opposing
Daioleslam’s first motion to compel or in moving for
reconsideration of the court’s July 2010 Order did the Appellants
inform the court that NIAC lacked a server. Instead, they referred
several times to its “server” or “shared server.” J.A. 143, 173, 182.
In responding directly to Daioleslam’s proposed order, which
would have required the Appellants to produce “the server on
which NIAC’s Outlook calendars are kept,” they objected only to
the omission of any prohibition on “metadata mining,” not to the
reference to a server. J.A. 157, 163.
24
PricewaterhouseCoopers for forensic imaging” so that PwC
could obtain “Outlook calendar records, complete and
unedited to the extent possible,” from NIAC’s network. J.A.
168 (emphasis added). The court ordered PwC to prepare a
report describing edits and deletions to the calendar entries,
including who made the alterations. J.A. 169. Even if it did
not have a server, then, NIAC knew that the purpose of the
imaging was to obtain and review its “complete and unedited”
calendar records. It was obligated to produce any computers
or shared drives on which that data was stored, including the
computer its legislative director used and its old shared drive.
Appellants contend that the fact the District Court had to
explain in its second, March 2011 Order that, in the absence
of a server or “shared drive,” NIAC must instead produce the
computers it had previously withheld, demonstrates that the
first order was ambiguous. See Appellants’ Br. at 52. On the
contrary, NIAC’s refusal to comply with the clear import of
the first order is what necessitated this clarification. Its
resolute failure to produce all relevant drives until over a year
after it was first ordered to do so is inexcusable.
2.
Similarly, Daioleslam’s expenses in redeposing Parsi and
Blout resulted from the Appellants’ disobedience of the
District Court’s orders and were a legitimate subject of Rule
37(b) sanctions. The Appellants, arguing that they violated
no court order in failing to produce the documents Daioleslam
needed to conduct these follow-up depositions, ask the Court
to reverse the sanctions. Appellants’ Br. at 56. We disagree.
Daioleslam’s February 2009 production requests sought
all documents related to U.S. political officials, including
meeting notes and calendars. Daioleslam specifically
requested lobbying time records after he deposed NIAC’s
25
employee responsible for e-discovery in early October 2009,
noting it was important that he receive them in time to prepare
for Blout’s deposition on December 8, 2009. J.A. 133. Given
NIAC’s admission that its employees “used their Microsoft
Outlook calendars to note meetings of any kind,” including
“meetings with government officials,” J.A. 206, it surely was
aware that its response to Daioleslam’s request was materially
incomplete if it omitted any Outlook entries. Similarly, NIAC
and Parsi were aware of their use of Salesforce to record
meeting notes. J.A. 622. Yet they produced no Outlook
entries at all until December 28, 2009, after Daioleslam had
first deposed Blout, and no Salesforce entries until much later.
In a March 4, 2010 filing, Daioleslam asked the District
Court to order Blout’s redeposition, observing that because of
the Appellants’ withholding of key documents he had not
been able to question Blout about NIAC’s “lobbying time
records . . . [and] Outlook records.” J.A. 134, 136.
Responding to Daioleslam’s concerns, it issued a minute
order the next day, ordering that “[Daioleslam] may take an
additional deposition of Emily Blount, although the Court
reserves judgment as to which party shall bear any expenses. .
. . [T]he parties are instructed to discuss further the production
of Outlook calendars, including those predating 2009.”
Minute Order, Parsi v. Daioleslam, No. 1:08-cv-00705
(D.D.C. Mar. 5, 2010). Thus, the court’s order that Blout be
redeposed expressly contemplated that NIAC would “further”
produce the remaining Outlook entries it had withheld, and
NIAC did make a further production of those entries before
Blout was redeposed in September 2010. But the Appellants
knew of the existence of NIAC meeting notes in Salesforce
that were just as directly relevant to Blout’s redeposition as
the Outlook entries, and of which the court was not yet aware,
and therefore could not have included in its minute order.
The Appellants would not produce these documents until
26
February 2011, five months after Daioleslam deposed Blout
for the second time. J.A. 623-24. Just as surely as the
Appellants’ withholding of NIAC’s server disobeyed a series
of written orders, their failure to produce meeting notes before
Daioleslam redeposed Blout frustrated the purpose of the
court’s March 5, 2010 minute order and caused significant
needless expense to Daioleslam.
In the same vein, we agree with the District Court that
NIAC’s “belated” production of its Salesforce data, in
violation of the court’s March 2011 Order, caused Daioleslam
to bear unnecessary expense by redeposing Parsi in May
2011. Parsi, 286 F.R.D. at 85. That order required the
Appellants to coordinate with Daioleslam to schedule Parsi’s
second deposition by April 6, 2011. In the same paragraph,
the court ordered the Appellants to “produce all documents to
be used during [Parsi’s] follow-up deposition at least three (3)
business days prior to” the scheduled deposition. J.A. 329.
Later in the same order, the court made clear that NIAC was
to produce any codes necessary to translate all of its
previously produced Salesforce data as well as its “entire
membership list in Convio (and all incorporated data fields) . .
. current as of the date that it is produced.” J.A. 331. When
Daioleslam redeposed Parsi in May 2011, however, NIAC
had not complied with the March 2011 Order. The only
additional production it had made was a list of Convio
“transactions” that mostly listed donations, rather than a
complete list of current members, as the court had ordered.
J.A. 446-47. It was not until after the court’s August 2011
Order—and months after Parsi’s wasted second deposition—
that NIAC complied.
The Appellants’ failure to obey the court’s orders caused
part of Daioleslam’s deposition expenses. The District Court
acted within its discretion in ordering the Appellants to pay
27
for part of Parsi and Blout’s redepositions and for the cost of
preparing the corresponding sections of Daioleslam’s
sanctions motion.
III.
In addition to sanctions contemplated by the Federal
Rules of Civil Procedure, courts have an inherent power at
common law, Chambers v. NASCO, Inc., 501 U.S. 32, 44
(1991), to “protect their institutional integrity and to guard
against abuses of the judicial process with contempt citations,
fines, awards of attorneys’ fees, and such other orders and
sanctions as they find necessary, including even dismissals
and default judgments.” Shepherd, 62 F.3d at 1472. These
powers inhere in the very nature of courts as an institution,
and are “necessary to the exercise of all others.” United
States v. Hudson, 11 U.S. 32, 34 (1812). Courts have
discretion to determine a fitting sanction for conduct that
abuses judicial proceedings, including assessing attorney’s
fees. This authority is an exception to the background
American Rule limiting cost-shifting generally. Chambers,
501 U.S. at 45.
Apart from two other narrow exceptions not relevant
here, a finding of bad faith is required for an award of
attorney’s fees under the court’s inherent power. Id. at 45-46;
Roadway Express, Inc. v. Piper, 447 U.S. 752, 765-66 (1980);
see Tucker v. Williams, 682 F.3d 654, 662 (7th Cir. 2012) (the
“inherent power . . . is not a grant of authority to do good,
rectify shortcomings of the common law . . . or undermine the
American rule on the award of attorneys’ fees”) (second
alteration in original) (internal quotation marks omitted). We
have held that exercise of a court’s power to impose “inherent
power sanctions that are fundamentally penal” requires that it
find bad faith by clear and convincing evidence. Shepherd,
28
62 F.3d at 1478; see also id. at 1474-78; Aoude v. Mobil Oil
Corp., 892 F.2d 1115, 1118 (1st Cir. 1989) (requiring clear
and convincing evidence of bad faith to impose inherent
power dismissal for a fraud on the court). In contrast, “issue-
related sanctions [that] are fundamentally remedial rather than
punitive and do not preclude a trial on the merits”—such as
barring admission of evidence or considering an issue
established for the purpose of the action—can be imposed on
a showing that the sanctioned party resisted discovery by a
preponderance of the evidence. Shepherd, 62 F.3d at 1478.
The clear and convincing standard “generally requires the
trier of fact, in viewing each party’s pile of evidence, to reach
a firm conviction of the truth on the evidence about which he
or she is certain.” United States v. Montague, 40 F.3d 1251,
1255 (D.C. Cir. 1994).
The District Court read Shepherd to require clear and
convincing evidence of bad faith only to impose the sanction
of dismissal, see Parsi, 286 F.R.D. at 77, but we emphasized
in Shepherd that “for those inherent power sanctions that are
fundamentally penal—dismissals and default judgments, as
well as contempt orders, awards of attorneys’ fees, and the
imposition of fines—the district court must find clear and
convincing evidence of the predicate misconduct.” 62 F.3d at
1478 (emphasis added). Since the sanctions the District
Court imposed consisted entirely of litigation expenses and
fees, we will affirm them only if the court found by clear and
convincing evidence that NIAC acted in bad faith.
A.
The Appellants claim that the District Court did not
purport to make a finding of bad faith under the proper
standard of proof when it awarded expenses for their failure to
produce emails with third parties. Appellants’ Br. at 54.
29
While the District Court might not have articulated the
Shepherd standard in the most clear and explicit manner,
however, we have no difficulty concluding it made the proper
finding.
We have made clear in the context of sanctions that the
term “bad faith” is not a “talisman[] required for affirmance.”
LaPrade v. Kidder Peabody & Co., 146 F.3d 899, 906 (D.C.
Cir. 1998). Nor do we require a district court to employ the
magic words “clear and convincing” to uphold its finding
under that standard of proof; we look instead to the
circumstances of the court’s factfinding. United States v.
Sobin, 56 F.3d 1423, 1428-29 (D.C. Cir. 1995); see also
United States v. Walsh, 119 F.3d 115, 121-22 (2d Cir. 1997)
(“Even though the district judge did not explicitly identify the
standard of proof by which he found [the defendant] had
committed perjury, because the evidence clearly supports that
finding and because the tenor of the judge’s ruling reflects his
firm convictions on that score, we have no doubt that the
judge’s finding passed the clear-and-convincing standard.”).
Here, the District Court described the Appellants’
withholding of relevant emails as “indefensible.” Parsi, 286
F.R.D. at 84. It noted that NIAC and Parsi made no attempt
to explain the omission, which in any event it described as
“inexplicable.” Id. The court also condemned NIAC and
Parsi for misrepresenting during a hearing that technical
reasons precluded them from producing almost 170 angry
emails from Iranian-Americans, when Daioleslam’s subpoena
to NIAC’s damages expert revealed the organization had
managed to compile the emails in order to demonstrate it had
suffered membership losses due to Daioleslam’s allegedly
defamatory statements. The court’s reproach for the
Appellants’ conduct, in other words, was evident, and was
based on a firm conviction that they had abused the discovery
30
process. In Shepherd, by contrast, we reversed because the
district court expressly applied the preponderance of the
evidence standard and rejected the argument that it should use
the clear and convincing evidence standard in imposing
inherent authority sanctions. 62 F.3d at 1475. Given the
District Court’s unmistakable conviction, supported amply by
the evidence, that the Appellants withheld numerous emails
with third parties they should have known were relevant, “it
would be an empty formalism to find an abuse of discretion
simply because the [D]istrict [C]ourt failed to invoke the
magic words ‘bad faith’”—or “clear and convincing.”
LaPrade, 146 F.3d at 906.
In view of the Appellants’ failure to explain their
withholding of so many relevant documents, some of which
they misrepresented to the District Court that they could not
locate, we cannot conclude it was clearly erroneous to find the
Appellants acted in bad faith. See First Bank of Marietta v.
Hartford Underwriters Ins. Co., 307 F.3d 501, 525 (6th Cir.
2002) (finding bad faith where plaintiff withheld document
that it knew undermined its cause of action); cf. Bonds, 93
F.3d at 812-13 (rejecting evidentiary sanction equivalent to
default, partly because “[t]here is no evidence that the
[defendant] withheld anything in discovery”).
B.
However, we cannot similarly conclude that the District
Court found misconduct by clear and convincing evidence
sufficient to uphold sanctions for Parsi’s purported alteration
of the IIC document. The District Court explicitly stated it
could not find by clear and convincing evidence that Parsi
altered the document in bad faith. Parsi, 286 F.R.D. at 87.
31
Likewise, we cannot affirm the court’s award of expenses
for Parsi’s false interrogatory response that he had used a
desktop computer that Progressive Office indicated was not
connected to the network. Here, the District Court explicitly
averted to the possibility that, since the Appellants “devoted
little attention to this issue in their briefing or at the motions
hearing, . . . [the court] may be awarding sanctions based on
conduct for which there is an innocent explanation that
plaintiffs have simply failed to give.” Id. at 86.
The District Court awarded $25,242.17 for Daioleslam’s
expenses in preparing his sanctions motion. J.A. 912. It
appears that the sections on Parsi’s interrogatory response and
the IIC document represent only a minor part of this motion,
but that is for the District Court to determine in the first
instance. We reverse this part of the sanctions award, and
remand for re-determination by the District Court under the
proper standard we have articulated.
IV.
Finally, we reverse the District Court’s award of post-
judgment interest to run from the date of its summary
judgment opinion on September 13, 2012 instead of from its
Final Order on April 9, 2013. Daioleslam does not contest
this determination. See Appellee’s Br. at 31 n.10. Interest
runs “from the date of the entry of the judgment,” 28 U.S.C. §
1961(a), which requires the court to enter final judgment
under Rule 54(b). Mergentime Corp. v. Washington Metro.
Area Transit Auth., 166 F.3d 1257, 1268 (D.C. Cir. 1999); see
also FED R. CIV. P. 54(b) (absent an express finding by
district court that there is no just reason for delay, final
judgment requires adjudication of “all the claims and all the
parties’ rights and liabilities”). Since the District Court did
not resolve Daioleslam’s final bill of recoverable costs until
32
April 9, 2013, post-judgment interest can only run from that
date.
V.
For the foregoing reasons, we affirm in part the District
Court’s award of sanctions, and reverse the award of
Daioleslam’s expenses in preparing the portions of his
sanctions motion related to NIAC’s alteration of a document
and Parsi’s interrogatory responses, as well as the award of
post-judgment interest to run from September 13, 2012. We
remand to the District Court for reconsideration of those
aspects of its judgment under the proper standard.
So ordered.