In the
United States Court of Appeals
For the Seventh Circuit
No. 08-3375
R HONDA S ALMERON,
Plaintiff-Appellant,
v.
E NTERPRISE R ECOVERY S YSTEMS, INC., et al.,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 05 C 4453—Milton I. Shadur, Judge.
A RGUED M AY 14, 2009—D ECIDED A UGUST 27, 2009
Before R IPPLE, M ANION, and T INDER, Circuit Judges.
M ANION , Circuit Judge. After her employer Enterprise
Recovery Systems (“ERS”) fired her, Rhonda Salmeron
brought this qui tam action on behalf of the United
States against ERS alleging that it committed fraud in its
student loan debt collection practices. Salmeron subse-
quently amended her complaint three times to add USA
Funds, Inc.; USA Group Guarantee Services, Inc.; USA
Servicing Corp.; Sallie Mae, Inc.; Sallie Mae Servicing, L.P.;
2 No. 08-3375
and Scott Nicholson as defendants. During the lawsuit’s
three-year sojourn in the district court, Salmeron’s attor-
ney, Jorge Sanchez, engaged in what the judge described
as a “virtually unbroken pattern of dilatory and irrespon-
sible conduct,” consistently missing filing deadlines
and failing to appear at status conferences. Fed up with
Sanchez’s repeated flouting of the court’s rules, the
district court dismissed the suit sua sponte. Though
ultimately persuaded to reinstate the action, the district
court issued a “final warning” to Sanchez that future
misconduct would not be tolerated. Only a short time
later, however, Sanchez breached an oral agreement he
had with opposing counsel and leaked a document ob-
tained through discovery to three separate sources. Upon
finding the document posted on an Internet website, the
defendants moved to dismiss the suit as a sanction for
the unauthorized disclosure. The district court granted
the motion, finding the leak “willful” and “inexcusable.”
Salmeron appeals, arguing that the punishment does not
fit the offending conduct. We affirm.
I.
In its opinion and order dismissing the suit, the
district court extensively chronicled the transgressions
of Salmeron’s counsel, Jorge Sanchez, during the course
of this litigation. The day after the deadline to respond to
ERS’s motion to dismiss, Sanchez, citing his workload
and personal issues as the reasons for the delay, filed a
motion for permission to file the response late, which the
district court granted. A few months later, Sanchez
No. 08-3375 3
missed the deadline to file a response to USA Funds’s
motion to dismiss. He again cited workload and family
obligations and asked the court to excuse the late filing,
which it did. A few months after that late filing, Sanchez
failed to timely respond to USA Funds’s request for
production of documents and interrogatories; the re-
sponses to the interrogatories were not submitted until
more than two and a half months after they were due.
Sanchez also failed to appear at a scheduled status con-
ference. Next, when responses to ERS’s interrogatories
and requests for production were already several weeks
overdue, Sanchez reneged on a promise that he would
provide the information. The court had to order Sanchez
to comply.
Sanchez’s dilatory conduct continued past the law-
suit’s second anniversary. Nine days after Salmeron’s
response to ERS’s motion to dismiss the second amended
complaint was due, rather than belatedly attempting to
respond, Sanchez instead filed a motion for leave to file
a third amended complaint. The court applied ERS’s
motion to the third amended complaint and set a new
deadline for Sanchez’s response. True to form, Sanchez
missed that deadline. Again citing his workload, Sanchez
moved for leave to file a response a week after the dead-
line had passed. The court and opposing counsel had
been apprised of the motion only minutes before a sched-
uled status hearing. Nevertheless, the court granted that
motion and set a deadline for Sanchez to file Salmeron’s
third amended complaint, which had yet to be filed.
Sanchez could not meet that deadline and asked for an
extension, which the district court granted. But the ex-
4 No. 08-3375
tended deadline passed without Sanchez filing anything.
Although the court’s clerk called Sanchez to inquire
about the status of the filing and was told it was forth-
coming, Sanchez neither attended the status hearing
scheduled shortly after the deadline nor filed the third
amended complaint. Only after the court ordered Sanchez
to file the third amended complaint or face dismissal
did Sanchez finally file that document.
Despite these admonitions, Sanchez’s foot-dragging
continued. On March 7, 2008, in response to the defen-
dants’ motions to dismiss and for summary judgment, the
court entered a scheduling order requiring Salmeron to
respond by April 11. Predictably, Sanchez filed a motion
for an extension on April 9, citing yet again his work-
load as a reason for delay. The court granted an extension
until April 18, but that date passed without Sanchez
filing a response to any of the motions. On May 1,
Sanchez filed a motion to extend the filing date for the
responses until May 6. The court granted that extension,
but Sanchez failed to meet that extended deadline as
well. On May 8, Sanchez contacted the court and
requested a continuance of the status hearing scheduled
for the next day, telling the court that the continuance
was necessary so that he could file the delinquent re-
sponses before the hearing. Sanchez promised to have
the responses filed by the afternoon of the next day, so
the district court agreed to postpone the hearing until
May 16. When, five days later, Sanchez still had not filed
his responses, the district court finally got his attention:
it entered an order dismissing the action for want of
prosecution.
No. 08-3375 5
Sanchez moved to reopen the case, arguing that his
failures as counsel should not be held against Salmeron. At
a hearing on the motion, the district court reinstated
the suit while, at the same time, giving Sanchez a stern
warning about the consequences of future misconduct:
Well, I guess the short answer is that with considerable
diffidence, I’m going to grant the Rule 59[(e)] motion
and permit the case to get back into a live posture,
but I want to tell you now you have really had what
amounts to the final warning, and we’re not going
to have any repetition of any of this, or it’s going to
result in a conclusion that you certainly won’t desire
and that . . . is really occasioned by this extended
pattern of noncompliance.
Despite the second chance, Sanchez raised his miscon-
duct to a more egregious level. On June 24, defendants
USA Funds, Sallie Mae, and ERS learned that a
scanned copy of the confidential document containing
the Guarantee Services Agreement between Sallie Mae
and USA Funds had been posted on a website known
as Wikileaks.org (“Wikileaks”).1 Also posted was a sum-
mary of the document and 13 inflammatory questions
about the possible “criminality” of the arrangement. Two
1
“[F]ounded by Chinese dissidents, journalists, mathematicians
and startup company technologists, from the US, Taiwan,
Europe, Australia and South Africa,” Wikileaks styles itself
as “an uncensorable version of Wikipedia for untraceable
mass document leaking and analysis.” http://wikileaks.org/
wiki/Wikileaks:About (last visited July 16, 2009).
6 No. 08-3375
days later, the Chronicle of Higher Education published
an online article about the leaked document captioned
“Contract Raises New Concern over Sallie Mae’s Ties to
Guarantor.” The Chronicle claimed it had obtained the
document several days before it appeared on Wikileaks
and denied providing it to Wikileaks. Both the copy of
the Guarantee Services Agreement leaked to Wikileaks
and the copy provided to the Chronicle bore Bates
stamps conclusively demonstrating that they originated
from USA Funds’s document production during this
lawsuit.
USA Funds then moved to dismiss the suit as a
sanction for the disclosure of the Guarantee Services
Agreement.2 Mark Sweet, USA Funds’s counsel, signed
an affidavit filed contemporaneously with the motion to
dismiss asserting that Sanchez had agreed to treat the
confidential documents disclosed by USA Funds during
discovery as being for “attorneys’ eyes only.” This condi-
tion was to remain in place until such time as the
existing protective order, entered earlier in the action
when only ERS was a defendant, could be modified to
include all parties. USA Funds also included the cover
letter accompanying its first production of documents
on January 31, 2007, wherein Sweet, writing to Sanchez,
stated that USA Funds intended to seek confidential
treatment for the Guarantee Services Agreement. Sweet
2
Defendants Sallie Mae, Inc.; USA Group Guarantee Services,
Inc.; USA Servicing Corp.; and Sallie Mae Servicing, L.P. soon
joined that motion.
No. 08-3375 7
also wrote in that letter that he had “circulated a draft
joint motion for entry of [a] modified protective order”
and that USA Funds would “move for confidential treat-
ment” of the Guarantee Services Agreement after the
court entered that order. In a separate email communica-
tion with Sanchez, Sweet attached a draft protective
order and asked Sanchez to add his changes. (Sanchez
had told Sweet that he wished to modify the protective
order to cover documents from Salmeron’s home com-
puter.) Sanchez replied that he would look over the
proposed protective order and “give . . . any feedback or
proposed modifications that [he] might have.” Two
months later, in a cover letter accompanying USA
Funds’s second production of documents, Sweet
reminded Sanchez that USA Funds was going to seek
confidential treatment for the Guarantee Services Agree-
ment and requested Sanchez to provide his edits on the
draft protective order so that the order could be entered.
Sanchez never provided his promised changes to the
proposed protective order. At the time of the leak, no
protective order was in place.
USA Funds also included with its motion to dismiss
an email exchange between its counsel and Sanchez that
occurred shortly after it discovered the leak. In that
exchange, Sanchez admitted that the document posted
on Wikileaks was the same version of the Guarantee
Services Agreement that USA Funds had produced in
the lawsuit, but he placed the blame on USA Funds
for never following up on the protective order with the
district court. He also stated that USA Funds failed to
indicate which documents “provided to plaintiff it con-
sidered to be confidential.”
8 No. 08-3375
In his response to the motion to dismiss, Sanchez stated
that the document “apparently ha[d] been leaked and
published without plaintiff’s counsel’s knowledge or
approval.” At a hearing the next day, the district judge
questioned Sanchez about how the document could
have been leaked without his knowledge when the
version of the Guarantee Services Agreement published
on Wikileaks had the same Bates numbering as the
version released during discovery. While denying
giving the Guarantee Services Agreement to Wikileaks,
Sanchez nevertheless backtracked and admitted that he
had leaked the document to three different, unauthorized
sources: his client, another attorney whom he was
thinking about bringing on as co-counsel, and a reporter
for the Chronicle. Finding Sanchez’s justifications for
his actions unpersuasive, the district court nonetheless
allowed Sanchez to file a brief arguing why a sanction
other than dismissal would be appropriate.
In that brief filed after the hearing, Sanchez admitted
that, had he referred to the cover letters accompanying
USA Funds’s document disclosures, he would have known
that USA Funds was seeking a confidential designation
for the leaked document and would not have shared it
with anyone, including the reporter for the Chronicle,
whom Sanchez stated he had been “put[ting] off” for
months before finally disclosing the document to him.
However, Sanchez claimed he misplaced the cover
letters and did not refer to them when he disclosed the
document. Although he denied personally leaking the
Guarantee Services Agreement to Wikileaks, Sanchez
admitted that the attorney to whom he leaked the docu-
No. 08-3375 9
ment may have done so. He argued that his disclosure
was inadvertent and that a monetary fine, and not dis-
missal, was the appropriate sanction.
The district court disagreed. In a comprehensive
opinion, it found that Sanchez violated the “attorneys’
eyes only” agreement he had reached with Sweet by
willfully disseminating the Guarantee Services Agree-
ment. The court also found that Sanchez had never
given a convincing explanation for doing so. The court
rejected Sanchez’s argument that he should not be sanc-
tioned because no protective order was in place pro-
tecting the document, finding instead that the lack of a
protective order was “unquestionably due to Sanchez’[s]
failure to provide a response as he had promised.” Relying
on its “inherent authority to rectify abuses to the judicial
process,” the court then decided that dismissal with
prejudice was the proper sanction and dismissed the
suit. Salmeron appeals.
II.
On appeal, Salmeron challenges both the district court’s
factual findings supporting the dismissal sanction and
its power to issue that sanction. A district court has
inherent power “to fashion an appropriate sanction for
conduct which abuses the judicial process.” Chambers v.
NASCO, Inc., 501 U.S. 32, 44-45 (1991). Sanctions meted
out pursuant to the court’s inherent power are appro-
priate where the offender has willfully abused the
judicial process or otherwise conducted litigation in bad
faith. Maynard v. Nygren, 332 F.3d 462, 470-71 (7th Cir.
10 No. 08-3375
2003). “Though ‘particularly severe,’ the sanction of
dismissal is within the court’s discretion.” Montano v. City
of Chicago, 535 F.3d 558, 563 (7th Cir. 2008) (quoting
Chambers, 501 U.S. at 45); accord Link v. Wabash R.R. Co., 370
U.S. 626, 633 (1962). While a district court must exercise
caution and restraint in exercising its inherent power,
Schmude v. Sheahan, 420 F.3d 645, 650 (7th Cir. 2005), our
review of the district court’s choice of sanction is deferen-
tial: “[f]indings of fact must stand unless clearly
erroneous, and a district judge’s decision that a party’s
misconduct is serious enough to justify dismissal with
prejudice is reviewed for abuse of discretion.” Ridge
Chrysler Jeep, LLC v. DaimlerChrysler Fin. Servs. Ams. LLC,
516 F.3d 623, 625 (7th Cir. 2008). Accordingly, “[w]e
will only reverse a district court’s imposition of sanctions
if one or more of the following is true: ‘(1) the record
contains no evidence upon which the court could have
rationally based its decision; (2) the decision is based on
an erroneous conclusion of law; (3) the decision is based
on clearly erroneous factual findings; or (4) the decision
clearly appears arbitrary.’ ” Judson Atkinson Candies, Inc.
v. Latini-Hohberger Dhimantec, 529 F.3d 371, 386 (7th Cir.
2008) (quoting Gile v. United Airlines, Inc., 95 F.3d 492,
495 (7th Cir. 1996)).
We begin with Salmeron’s challenges to the district
court’s factual findings, which we will reverse only if
left with a “definite and firm conviction that a mistake
has been committed.” NutraSweet Co. v. X-L Eng’g Co.,
227 F.3d 776, 790 (7th Cir. 2000). Salmeron first attacks
the district court’s finding that Sanchez and USA Funds’s
counsel, Mark Sweet, had agreed to keep the Guarantee
No. 08-3375 11
Services Agreement for “attorneys’ eyes only” until the
district court entered a protective order governing docu-
ment disclosure between the parties. She does not
dispute the existence of the “attorneys’ eyes only” agree-
ment. Rather, she argues that there is nothing in
Sweet’s declaration to support the district court’s
finding that Sanchez had agreed specifically to keep the
Guarantee Services Agreement confidential. The problem
with that argument is that Salmeron never seriously
disputed in the court below that the Guarantee Services
Agreement was covered by the “attorneys’ eyes only”
agreement. Although Sanchez at first claimed, in his
email response to USA Funds after the leak, that USA
Funds did not indicate which documents “it considered
to be confidential,” he later admitted that the cover
letters accompanying USA Funds’s document produc-
tions clearly showed that USA Funds was seeking a
confidential designation for the Guarantee Services Agree-
ment—which was all that was required to bring
that document within the ambit of the “attorneys’ eyes
only” agreement.
Faced with that concession, Salmeron changes course
and attempts to refashion the agreement on appeal. She
latches onto the phrase in Sweet’s affidavit that “USA
Funds wanted the same protections for its documents
as those afforded by the Protective Order already in
place between” ERS and Salmeron. Salmeron claims that
phrase meant the ERS protective order governed the
“attorneys’ eyes only” agreement. Following that logic,
Salmeron argues the Guarantee Services Agreement was
not protected because it (1) was not stamped “CONFI-
12 No. 08-3375
DENTIAL” and (2) was not the subject of a motion
seeking the lower court’s approval of the confidentiality
designation—both of which, Salmeron claims, are pre-
requisites under the protective order between ERS and
Salmeron for confidential protection.
We reject the premise. Sweet’s statement does not say
anything about the “attorneys’ eyes only” agreement. The
“attorneys’ eyes only” agreement required Sanchez to
treat the confidential documents of USA Funds as for
“attorneys’ eyes only” until such time as a protective
order could be entered. That was the extent of the agree-
ment; it was merely a stopgap until the district court
entered a protective order governing USA Funds’s con-
fidential documents. While the protective order
eventually entered by the district court governing discov-
ery between Salmeron and USA Funds set forth the
same procedures for determining confidentiality as the
ERS protective order, Sanchez’s unauthorized disclosure
of the Guarantee Services Agreement occurred before
that order was in place. Salmeron therefore cannot now
claim that USA Funds was required to follow the pro-
visions of an order that was not yet in place—especially
because Sanchez failed to return the draft protective
order with his proposed changes to USA Funds’s
counsel, thereby preventing the protective order from
being entered in the first place.
Salmeron also claims that the district court clearly erred
in finding that Sanchez’s disclosure of the Guarantee
Services Agreement was willful, thereby triggering the
court’s inherent power to sanction. See Greviskes v. Universi-
No. 08-3375 13
ties Research Ass’n, Inc., 417 F.3d 752, 759 (7th Cir. 2005)
(“Dismissal is appropriate where a party has displayed
fault, bad faith, or willfulness.”); see also Downs v. Westphal,
78 F.3d 1252, 1257 (7th Cir. 1996). We conclude,
however, that the district court did not clearly err in
finding willfulness. Before the district court, Sanchez
admitted that he indeed did disclose the Guarantee
Services Agreement—not once, but three times in violation
of the “attorneys’ eyes only” agreement: to his client,
another lawyer, and the reporter for the Chronicle.
Sanchez admitted that the other attorney to whom he
disclosed the document may have been the source of the
Wikileaks posting. And his disclosure to the reporter for
the Chronicle is especially telling. A reasonable person
should know that giving a sensitive document to a
member of the press, particularly one whose interest in
the document was so keen that Sanchez repeatedly had
to “put him off,” almost inevitably will lead to its pub-
lication. That alone is more than sufficient to support
the district court’s finding of willfulness. See Stive v.
United States, 366 F.3d 520, 522 (7th Cir. 2004).
Salmeron nevertheless maintains that Sanchez’s disclo-
sures were merely negligent. She claims that Sanchez
misplaced the cover letters accompanying USA Funds’s
document disclosures and thus did not know that the
Guarantee Services Agreement was confidential. But,
given Sanchez’s shifting stories, the district judge was
entitled to disbelieve that explanation. At first, Sanchez
did not deny disclosing the document in his email
response to USA Funds’s counsel, instead blaming USA
Funds for failing to specifically mark it confidential and
14 No. 08-3375
move for a protective order. Later on, Sanchez claimed
it had “been leaked and published without plaintiff’s
counsel’s knowledge or approval.” Still later, after the
district court confronted him with the Bates stamping on
the Wikileaks document, Sanchez admitted he had
“exercis[ed] bad judgment” and leaked it to three dif-
ferent sources. Only in his final response to USA Funds’s
motion to dismiss did Sanchez raise the misplaced
cover letter explanation. The district court found that
Sanchez’s contradictory excuses were “totally unconvinc-
ing” and that “no real explanation ha[d] been offered” for
the unauthorized disclosure. Hence, the district court’s
finding that Sanchez willfully disclosed the Guarantee
Services Agreement was not clearly erroneous.3
With the facts firmly established, we now turn to
Salmeron’s other challenges to the district court’s sanction
of dismissal. Salmeron first argues that the district court
should not have sanctioned her because no protective
order was in place disallowing the disclosure. In
support of that argument, Salmeron cites Jepson, Inc. v.
Makita Electric Works, Ltd., 30 F.3d 854 (7th Cir. 1994). In
that case we stated, “Absent a protective order, parties
to a law suit may disseminate materials obtained during
3
We do not discuss Salmeron’s challenge to the district court’s
finding that the Guarantee Services Agreement involved trade
secrets because that finding is not implicated in this appeal. The
real issue is whether Sanchez willfully violated his agreement
with opposing counsel when he leaked the Guarantee Services
Agreement, not whether that document actually deserved
confidential treatment.
No. 08-3375 15
discovery as they see fit.” Jepson, 30 F.3d at 858.
The problem with that argument, however, is it ignores
the “attorneys’ eyes only” agreement. Sanchez volun-
tarily entered into that agreement. As discussed above,
that agreement restricted Sanchez from disseminating
the Guarantee Services Agreement. Sanchez clearly vio-
lated the agreement when he shared that document
with third parties.
We also reject Salmeron’s related contention that the
district court was required to find “good cause” for
keeping the Guarantee Services Agreement confidential
before sanctioning Sanchez for his unauthorized dissemi-
nation of that document. It is of course true, as Jepson
holds, that a district court is required to “independently
determine if ‘good cause’ exists” before judicially protect-
ing discoverable documents from third-party disclosure.
30 F.3d at 858; see also Fed. R. Civ. P. 26(c). But in this
case the district court never had that opportunity
because Sanchez short-circuited the protective-order
process. When delivering the draft protective order to
Sanchez, Sweet wrote to Sanchez that USA Funds would
move for confidential treatment of the Guarantee
Services Agreement after Sanchez made his changes and
the district court entered the order. Sanchez responded
that he would look over the proposed order and would
“give [USA Funds] any feedback or proposed modifica-
tions” he might have. Had Sanchez done what he told
USA Funds’s counsel he was going to do, USA Funds
would have had an opportunity to present the proposed
protective order to the district court along with a motion
seeking confidential protection for the Guarantee
16 No. 08-3375
Services Agreement. In turn, the district court would
have had an opportunity to rule on whether there was
good cause to keep the document confidential. But
Salmeron’s attorney instead chose to bypass the district
court’s prerogative to determine confidentiality when he
divulged the document himself before submitting his
changes to the proposed protective order. Salmeron
therefore cannot now complain of a lack of a ruling on
good cause.
Despite Sanchez’s failure to return his modifications,
Salmeron nevertheless claims that USA Funds was at
fault for the absence of a protective order because, ac-
cording to Salmeron, it was unreasonable for USA
Funds’s lawyers to wait more than 17 months for Sanchez’s
feedback on the draft protective order. Counsel for USA
Funds had an independent obligation to its client, and
Salmeron contends its lawyers should have moved for
confidential protection of the Guarantee Services Agree-
ment “promptly when it did not hear back from
Mr. Sanchez.” Because USA Funds’s lawyers did not so
move, Salmeron argues that she should not face
sanctions for their failure to protect their client.
It does appear that nothing prevented USA Funds’s
lawyers from protecting their client’s interests sooner, and
perhaps they should have. But Salmeron’s argument
essentially boils down to faulting USA Funds’s lawyers
for not protecting their client from an adversary who
might not be trustworthy. We cannot accept that assertion.
Attorney integrity is fundamental to the judicial process.
The rules of conduct governing the profession prohibit
No. 08-3375 17
lawyers from engaging in conduct that involves dishon-
esty and misrepresentation. See, e.g., Model Rules of
Prof’l Conduct R. 8.4(c); Model Code of Prof’l Responsi-
bility DR 1-102(A)(4); N.D. Ill. R. 83.58.4(a)(4); Ill. S. Ct. R.
Prof’l Conduct 8.4(a)(4). And the Seventh Circuit’s Stan-
dards for Professional Conduct specifically state that a
lawyer is permitted to rely on opposing counsel’s
promises and agreements. Practitioner’s Handbook for
Appeals, Standards for Prof’l Conduct within the Seventh
Judicial Circuit, at 143 ¶ 6 (2003). We therefore find
Salmeron’s argument that USA Funds’s attorneys ought
to have been more wary of the opposition completely
unpersuasive. Sanchez agreed to keep USA Funds’s
confidential documents for “attorneys’ eyes only.” He
also promised to get back to USA Funds’s lawyers about
his proposed changes to their draft protective order. The
attorneys for USA Funds were entitled to take Sanchez
at his word.
Salmeron also complains she was not adequately
warned that dismissal would result from the disclosure
of the Guarantee Services Agreement. We disagree.
Sanchez received a “warning shot” when, after
repeatedly trying the court’s patience, the district court
dismissed the lawsuit without prejudice. After
reinstating the suit, the court explicitly told Sanchez that
he was receiving his “final warning” and that any
further misconduct was likely to result in a more
drastic sanction. That warning still should have been
fresh in Sanchez’s mind when, just one month later, he
willfully disclosed the Guarantee Services Agreement
18 No. 08-3375
in violation of the “attorneys’ eyes only” agreement. See
Williams v. Chicago Bd. of Educ., 155 F.3d 853, 858-59 (7th
Cir. 1998) (finding adequate notice where district court
previously had sanctioned the plaintiff and warned that
further sanctions would ensue from continued abuse of
the judicial process).
But, Salmeron protests, the district court’s previous
warning did not encompass Sanchez’s disclosures
because they “differed in kind” from his earlier transgres-
sions. While true, that reasoning supports the district
court’s decision rather than undermining it. If Sanchez’s
previous litigation abuses had prompted the district
court to flirt with dismissal, he certainly should have
expected his willful violations of an agreement with
opposing counsel—a far more serious set of offenses—“to
be answered with dismissal.” Fed. Election Comm’n v.
Al Salvi for Senate Comm., 205 F.3d 1015, 1019 (7th Cir.
2000).
Salmeron next contends that the district court abused its
discretion by dismissing her potentially meritorious
lawsuit when, according to Salmeron, Sanchez’s miscon-
duct had “no meaningful impact on the course of litiga-
tion.” We reject that argument for two reasons. First,
Salmeron presents little more than her personal opinion
to support her assertion that her lawsuit had merit.
Second, contrary to Salmeron’s contention, we do not
require a district court to measure the impact on the
litigation of a wrongdoer’s willful misconduct before it
issues a dismissal sanction. See Barnhill v. United States,
11 F.3d 1360, 1368 (7th Cir. 1993) (“We continue to
No. 08-3375 19
eschew grafting a requirement of prejudice onto a
district court’s ability to dismiss or enter judgment as a
sanction under its inherent power.”). A district court
certainly can consider the extent of the prejudice to the
opposing party when determining an appropriate sanc-
tion. But a district court’s inherent power to sanction for
violations of the judicial process is permissibly exercised
not merely to remedy prejudice to a party, but also to
reprimand the offender and “to deter future parties from
trampling upon the integrity of the court.” Dotson v. Bravo,
321 F.3d 663, 668 (7th Cir. 2003).4
4
Salmeron asserts that the district court failed to consider lesser
sanctions. But that claim does not square with the record. The
district judge stated during the July 3, 2008, hearing that, while
he believed sanctions were in order for Sanchez’s improper
disclosure of the Guarantee Services Agreement, he still had
yet to “defin[e]” the “appropriate sanction.” As he told
Sanchez, “[M]y question of you I guess is: Why shouldn’t what
I think is really a serious abuse call for, if not dismissal, then
what? And that’s what I would like you to respond to.” Accord-
ingly, the district court permitted Salmeron’s counsel to file
a brief explaining why a lesser sanction than dismissal would
be appropriate. Salmeron’s claim that the district court refused
to consider the availability of lesser sanctions is thus without
merit.
Salmeron also contends that she was “totally blameless” and
was therefore disproportionately punished for her counsel’s bad
actions. That argument gets nowhere. “The rule is that all of
the attorney’s misconduct . . . becomes the problem of the
(continued...)
20 No. 08-3375
Lastly, Salmeron argues that the interests of the gov-
ernment will be harmed by the dismissal of her suit.5 While
4
(...continued)
client.” Bakery Mach. & Fabrication, Inc. v. Traditional Baking, Inc.,
570 F.3d 845, 848 (7th Cir. 2009). Salmeron’s “beef” is with
her lawyer, not the district court’s ruling. Id.
5
As a reason for prejudice, Salmeron asserts that the statute of
limitations “may” have run on the government. That assumes
that the government is not bound by the district court’s dis-
missal with prejudice of Salmeron’s suit, a questionable assump-
tion after United States ex rel. Lusby v. Rolls-Royce Corp., 570
F.3d 849 (7th Cir. 2009). In that case, the district court dis-
missed the relator’s suit with prejudice but stated in its
order that the dismissal was without prejudice to the United
States. We rejected that attempt to keep the option open for
the United States to bring suit on its own behalf: “when the
judge dismissed the qui tam suit with prejudice, Lusby, the
United States, and all other potential relators were bound.”
Lusby, 570 F.3d at 853. We stated that “[t]he United States
must protect its interest by intervening in a qui tam action
rather than by asserting a right to file a False Claims Act suit
after the defendant has prevailed.” We need not dwell on the
question of whether the government could file suit after
Salmeron’s action was dismissed with prejudice, however,
because the government showed no interest in intervening in
her suit.
Salmeron also claims that the district court violated 31 U.S.C.
§ 3730(b)(1) by failing to obtain the Attorney General’s written
consent before dismissing the action. Such consent is not
required, however, for suits like Salmeron’s that are involun-
(continued...)
No. 08-3375 21
that may or may not be true—Salmeron has failed to
show that her suit has merit—we reject that argument as
a reason to withhold the dismissal sanction. The govern-
ment was given ample opportunity to protect its own
interests in this case. It was served with the initial com-
plaint as well as every other document filed in this case,
including the district court’s first order dismissing the
suit for want of prosecution and USA Funds’s motion
asking the court to sanction Sanchez for the disclosure
of the Guarantee Services Agreement by dismissing the
suit. The government therefore had notice of Sanchez’s
misconduct and could have intervened. See 31 U.S.C.
§ 3730(b)(2), (c)(3).
In sum, we hold that the district court did not abuse
its discretion in dismissing Salmeron’s suit with
prejudice as a sanction for Sanchez’s unauthorized dis-
closure of the Guarantee Services Agreement. While
harsh, the sanction was merited. See Patterson by
Patterson v. Coca-Cola Bottling Co. Cairo-Sikeston, Inc., 852
F.2d 280, 284-85 (7th Cir. 1988). Sanchez disregarded
his obligations as an officer of the court when he
violated the agreement he had made with USA Funds’s
5
(...continued)
tarily dismissed. See United States ex rel. Shaver v. Lucas W.
Corp., 237 F.3d 932, 934 (8th Cir. 2001); Minotti v. Lensik, 895
F.2d 100, 103 (2d Cir. 1990) (per curiam); see also Searcy v.
Philips Elecs. N. Am. Corp., 117 F.3d 154, 158 (5th Cir. 1997)
(“[T]he government forthrightly acknowledges that requiring
the government’s consent to an involuntary dismissal would
raise separation-of-powers concerns.”).
22 No. 08-3375
counsel and leaked the Guarantee Services Agreement.
His decision to leak the document before a protective
order was entered further subverted the administration
of justice by highjacking the district court’s prerogative
under the Federal Rules of Civil Procedure to determine
what documents are confidential. Moreover, we cannot
ignore that Sanchez’s violation of his agreement with
opposing counsel came on the heels of a pattern of abuse
of the judicial process, a pattern that involved his
repeated disregard for court-ordered deadlines and
failures to appear at court-mandated status hearings,
and a pattern for which Sanchez had already received a
“final warning” that further misconduct would not be
tolerated. The district court showed extensive patience
with Sanchez’s dilatory, even defiant, conduct. But faced
with an even more flagrant offense by Sanchez after
previously giving him a “final warning,” the district court
certainly was entitled to say, “enough is enough.” Pyramid
Energy, Ltd. v. Heyl & Patterson, Inc., 869 F.2d 1058, 1062
(7th Cir. 1989).
III.
The district court did not clearly err in finding that the
“attorneys’ eyes only” agreement encompassed the Guar-
antee Services Agreement, nor did it clearly err in
finding that Sanchez had willfully violated the “attorneys’
eyes only” agreement by leaking the Guarantee Services
Agreement to unauthorized third parties. Moreover, in
light of Sanchez’s continuing pattern of misconduct for
which he had been given a “final warning,” the district
No. 08-3375 23
court did not abuse its discretion in dismissing
Salmeron’s suit with prejudice as a sanction for the
willful leaks of the document. The judgment of the
district court is A FFIRMED.
8-27-09