[PUBLISH]

In the

United States Court of Appeals

For the Eleventh Circuit

____________________

No. 22-12461

____________________

J.C. PENNEY CORPORATION, INC., 

Plaintiff-Counter Defendant-Appellee,

versus

OXFORD MALL, LLC, 

Defendant-Counter Claimant-Appellant.

____________________

Appeal from the United States District Court

for the Northern District of Alabama

D.C. Docket No. 1:19-cv-00560-KOB

____________________

Before GRANT, ABUDU, and ED CARNES, Circuit Judges.

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GRANT, CIRCUIT JUDGE:

A limited liability company named Oxford Mall fought J.C. 

Penney in federal court for over two years. Just when it was poised 

to lose the case, Oxford informed the court that it lacked subjectmatter jurisdiction over the lawsuit. The court issued sanctions, 

ordering Oxford to pay part of J.C. Penney’s wasted attorney’s fees. 

But Oxford was not finished yet. When the district court asked the 

parties for briefing on the appropriate amount of fees, Oxford 

added an affidavit explaining why sanctions were not appropriate. 

The district court struck the affidavit and awarded J.C. Penney twothirds of its requested fees. Oxford challenges both decisions as 

abuses of discretion. We emphatically affirm.

I.

In a 2017 foreclosure sale, Oxford Mall, LLC, purchased the

Quintard Mall Shopping Center and subsequently entered into a 

significant redevelopment plan with the local government. Acting 

on this agreement, Oxford renovated the mall’s interior and razed 

what had been an old Sears store in anticipation of new, more 

inviting construction. More development was yet to come, but all 

was not well behind the storefronts.

Enter J.C. Penney Corporation, Inc., a fixture at the mall

since 1968. As an inducement to set up shop, J.C. Penney’s lease

included the right to approve certain changes to the mall’s site plan, 

as well as options to extend the lease’s term. Decades after that 

initial agreement, and years after the mall changed hands, J.C. 

Penney sought to exercise one of its remaining contractual options. 

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But just three days after agreeing to redevelop the mall, Oxford 

denied that request, claiming that J.C. Penney was out of extension 

options. Whether that was true was crucial for the redevelopment

plans—if J.C. Penney’s lease was still in effect, Oxford would need

its approval to redevelop certain parts of the mall. If not, the 

renovations could move forward unimpeded.

J.C. Penney filed this lawsuit in April 2019, invoking the 

district court’s diversity jurisdiction. For federal diversity 

jurisdiction to attach, all parties must be completely diverse. 

Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 267 (1806). Oxford 

Mall did not contest jurisdiction in its answer to the complaint—

and even pleaded diversity jurisdiction in its counterclaim. Both 

parties took the position that the court had diversity jurisdiction,

but Oxford’s LLC ownership structure made it a complex question. 

A limited liability company or a limited partnership has the 

citizenship of each one of its members. Rolling Greens MHP, L.P. v. 

Comcast SCH Holdings L.L.C., 374 F.3d 1020, 1021–22 (11th Cir. 

2004). And because members of an LLC are often themselves LLCs 

or LPs, the citizenship inquiry can balloon at each step. 

J.C. Penney is a citizen of Delaware and Texas. So diversity 

jurisdiction is defeated if any member of Oxford Mall, LLC, is a 

citizen of Delaware or Texas. And if any of those members were 

LLCs or LPs, the same rule would apply for the members of those 

members, and so on. These requirements were met according to 

both parties’ pleadings, and for the next two years, the lawsuit 

proceeded with the understanding that jurisdiction existed.

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In the meantime, a second dispute popped up. Hibbett 

Sporting Goods—another tenant—sued Oxford in August 2019, 

seeking a declaration of its right to extend its lease term. Like J.C. 

Penney, Hibbett asserted diversity jurisdiction. This time, though, 

Oxford and its attorney Wayne Grovenstein1 immediately began 

seeking information that would strip the court of jurisdiction over 

the case. In one email to a member of Oxford, Eightfold

Opportunity Fund II, LP, Grovenstein accurately explained how to 

determine diversity jurisdiction for Oxford. He emphasized that if 

Eightfold was a citizen of Alabama, federal jurisdiction would be 

unavailable and the Hibbett suit would move to state court—a 

better forum from the partnership’s perspective. “Likewise for J.C. 

Penney,” he went on, “if one or more of the members is a Texas or 

Delaware resident, then we may be able to relocate their lawsuit 

to Georgia.” The same outreach was repeated throughout 

Oxford’s ownership chain, but without immediate success in 

identifying a non-diverse person or entity that could shift either suit 

to state court.

Those efforts trailed off in late 2019 for unknown reasons—

until January 2020, that is, when the Hibbett court ordered Oxford 

to disclose the identity of all of its members and their states of

citizenship. At this point, Grovenstein reached back out to 

Eightfold. Explaining his renewed interest, Grovenstein wrote that 

he assumed that the judge did “not want to spend time on a 

1Grovenstein is general counsel for Oxford’s property manager, Hull Property 

Group, LLC.

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diversity action for which diversity jurisdictions [sic] does not 

actually exist,” just to “have the proceedings vacated at some later 

date.”

The revived efforts paid off. On January 28, 2020, Eightfold

identified a Delaware citizen in its ownership chain, refuting 

Hibbett’s assertion of diversity jurisdiction. The very next day,

Oxford filed a complaint against Hibbett in Georgia state court. 

And thirty-six days after that, it filed a motion to dismiss the federal

Hibbett case for lack of jurisdiction. That was March 5, 2020.

For the J.C. Penney case, however, there was no such filing—

Oxford continued to actively litigate in federal court. Briefing on

the parties’ cross-motions for summary judgment was completed 

just six days before Oxford learned that it was a Delaware citizen—

one of J.C. Penney’s states of citizenship. Oxford did not follow up 

with the court. A few months later, when the district court stayed

the case in light of J.C. Penney’s bankruptcy petition, Oxford 

remained silent. Litigation resumed after J.C. Penney agreed to

relinquish the right to have the claims heard in bankruptcy court. 

Still, no one told the court. The stay was lifted on August 7, 2020—

more than six months after Oxford learned it was a Delaware

citizen. Still no word. With nothing standing in the way (that it 

knew of), the district court turned to the merits. On August 27, it 

granted J.C. Penney’s motion for partial summary judgment and 

denied Oxford’s motion in full. Still no word.

Dissatisfied with that outcome, Oxford filed a motion for 

reconsideration. Still no mention of the jurisdictional problem. 

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Over the next two months, the parties briefed the motion and the 

district court again ruled in favor of J.C. Penney on November 24, 

2020. Still no word. Following that ruling, Oxford and J.C. Penney 

jointly asked the district court to stay the case once more, this time 

for mediation. Still—no word. Mediation was held on March 31, 

2021, more than fourteen months after Oxford learned it was a 

Delaware resident. The parties could not come to an agreement, 

and they informed the district court of that fact on April 14. Oxford 

Mall—still—informed neither J.C. Penney nor the court about the 

lack of jurisdiction. The court scheduled a status conference for 

April 28, 2021.

Exactly one week later—five days before the scheduled 

conference and fifteen months after learning that both parties in 

the case were citizens of Delaware—Oxford filed a motion to 

dismiss for lack of subject-matter jurisdiction, finally informing the 

court of the lack of diversity. The district court immediately stayed 

all proceedings. For its part, J.C. Penney moved for sanctions 

under Federal Rule of Civil Procedure 37 and the court’s inherent 

powers. The court granted Oxford’s motion to dismiss, but 

retained jurisdiction over J.C. Penney’s motion for sanctions.

After briefing and a hearing on the matter, the court agreed 

to issue sanctions under its inherent powers (but not Rule 37), 

instructed J.C. Penney to outline its fees, and asked Oxford to brief 

the reasonableness of that amount. Oxford filed a brief as 

requested. But it also added an affidavit from its attorney,

Grovenstein, who asserted that Oxford Mall had not intentionally 

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misled the court. The district court was unmoved, and it struck 

the affidavit as untimely and irrelevant. After yet another round of

briefing, the court awarded J.C. Penney $62,556 in attorney’s fees—

two-thirds of the amount that it incurred after Oxford learned the 

diversity-destroying information—and another $558.05 in costs. 

This is Oxford Mall, LLC’s appeal from both rulings.

II.

This Court reviews sanctions orders for abuse of discretion. 

Purchasing Power, LLC v. Bluestem Brands, Inc., 851 F.3d 1218, 1222 

(11th Cir. 2017). And because a finding of bad faith is a finding of 

fact, we review it for clear error. DeLauro v. Porto (In re Porto), 645 

F.3d 1294, 1304 (11th Cir. 2011); accord Skanska USA Civ. Se. Inc. v. 

Bagelheads, Inc., 75 F.4th 1290, 1311 (11th Cir. 2023). We also 

review a district court’s ruling on the admissibility of evidence, 

including a decision to strike an affidavit, for abuse of discretion. 

See Corwin v. Walt Disney Co., 475 F.3d 1239, 1249, 1252 (11th Cir. 

2007); Useden v. Acker, 947 F.2d 1563, 1571–72 (11th Cir. 1991).

III.

The inherent powers of the federal courts include the 

authority to fashion sanctions for conduct that abuses the judicial 

process. Goodyear Tire & Rubber Co. v. Haeger, 581 U.S. 101, 107 

(2017). This power’s “dual purpose” is “to vindicate judicial 

authority” and “to make the prevailing party whole.” Purchasing 

Power, 851 F.3d at 1223. The “key to unlocking” that power is a 

finding of bad faith. Id. But a blank conclusion that a party acted 

in bad faith is not enough; the court instead needs to make specific 

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findings about which conduct justifies sanctions. DeLauro, 645 F.3d 

at 1304. And those findings must show “subjective bad faith,” 

meaning intentional and not just reckless behavior. Purchasing 

Power, 851 F.3d at 1224–25. Still, that intent can be inferred “if an 

attorney’s conduct is so egregious that it could only be committed 

in bad faith.” Id.

Just so here, where the district court made a series of specific

factual findings about why Oxford’s actions were in bad faith. First, 

on January 28, 2020, Oxford had actual knowledge that it, like J.C. 

Penney, was a citizen of Delaware, which destroyed the court’s 

diversity jurisdiction. Next, the district court found that Oxford 

properly understood the relevant law—a conclusion made 

necessary by Oxford’s surprising argument that because 

Grovenstein was a transactional lawyer, it was “imminently 

plausible” that he did not recognize the relevance of shared 

citizenship. That is absolute nonsense. Grovenstein was in charge 

of Oxford’s effort to establish its citizenship, and his emails reflect 

that he full well knew the effect of shared citizenship on diversity 

jurisdiction. Oxford’s contention that it did not consider the 

connection between its two tenant disputes at the same property 

until after mediation was disproven by attorney Grovenstein’s own 

September 2019 email spelling out the implications of the Hibbett

jurisdictional inquiry to the J.C. Penney litigation.

Finally, the district court found that Oxford’s delay in 

disclosing the lack of diversity jurisdiction was strategic; it waited

until April 2021—15 months and several unfavorable rulings later.

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This evidence, the court concluded, showed that the

conduct was “so egregious that Oxford Mall could only have 

committed it in bad faith.” We cannot disagree; Oxford Mall’s

wrongdoing here is startling in its obviousness. But even if we 

were less certain, when “there are two permissible views of the 

evidence, the factfinder’s choice between them cannot be clearly 

erroneous.” Brnovich v. Democratic Nat’l Comm., 141 S. Ct. 2321, 

2349 (2021) (quoting Anderson v. Bessemer City, 470 U.S. 564, 574 

(1985)). The district court’s determination of bad faith is far more 

than “plausible in light of the entire record,” and we do not disturb 

it. See id.

Oxford, however, proteststhatsanctions are not appropriate 

because bad faith is not the only plausible explanation for its actions. 

But that argument misunderstands the standard. Requiring the 

district court to rule out all other “plausible” explanations would 

be tantamount to requiring proof beyond a reasonable doubt—a 

bar even Oxford admits is too high.2 The district court, in short,

did not abuse its “broad discretion” in deciding whether to impose 

sanctions. Peer v. Lewis, 606 F.3d 1306, 1316 (11th Cir. 2010). 

2 We need not decide today whether district courts should use a 

preponderance standard or a clear-and-convincing standard. The district court

applied the clear-and-convincing standard “out of an abundance of caution,”

and neither party challenges that decision on appeal.

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IV.

Oxford also argues that even if it did act in bad faith, the 

district court’s sanction award was too high. Again, we disagree.

When a court uses its inherent authority to award a sanction 

in the form of attorney’s fees, legal fees awarded “must be 

compensatory rather than punitive”—at least in civil litigation. 

Goodyear, 581 U.S. at 108. Because the purpose of this fee-shifting

mechanism is to reimburse the victim, a causal connection is 

required between the fees awarded and the sanctioned party’s

misconduct. Id. at 108–09. So the complaining party may only 

recover those fees it would not have incurred “but for” its 

opponent’s misconduct. Id. at 109 (quotation omitted).

Under this approach, the court’s “fundamental job” is to 

decide whether a legal fee would have existed even without the 

sanctioned conduct. Id. at 110. This sometimes means evaluating 

each specific litigation expense—but not always. Id. at 109. The 

Supreme Court has been careful to avoid turning judges into 

auditors: courts assessing fees “need not, and indeed should not, 

become green-eyeshade accountants.” Id. at 110 (quoting Fox v. 

Vice, 563 U.S. 826, 838 (2011)). So “rough justice” is the aim, not

“auditing perfection.” Id. (quotation omitted).

Along these lines, a district court may consider “its overall 

sense of [the] suit” and “use estimates in calculating and allocating 

an attorney’s time.” Id. (alteration adopted) (quotation omitted). 

It could decide, for example, that “all (or a set percentage) of a 

particular category of expenses” satisfy the standard. Id. In 

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“exceptional cases,” the court could even award all fees incurred 

after some significant event during the litigation. Id. As for our 

standard of review on appeal, the district court’s judgment is 

“entitled to substantial deference” in light of its “superior 

understanding of the litigation.” Id. (quotation omitted). 

The district court here complied with these standards. Its

starting point was the amount of fees that J.C. Penney incurred 

after March 5, 2020—the date Oxford moved to dismiss the Hibbett

case for lack of subject-matter jurisdiction. After all, “J.C. Penney 

would not have litigated any matters in this case after March 2020, 

‘but-for’ Oxford Mall’s bad faith.”

That was not the only limitation. The district court offered

two reasons for not awarding J.C. Penney all of its fees starting on

that date. For one, “J.C. Penney’s efforts to litigate this case since 

March 2020 were not entirely wasted” because it was able to make

“use of its arguments from this case in the state court proceeding.” 

So awarding all of its fees from the relevant time period would 

“overcompensate J.C. Penney, rather than ‘making it whole.’” On 

top of that, the district court placed at least some part of the blame 

on J.C. Penney for not working harder to discover the jurisdictional 

defect itself.

For these reasons, the district court limited its sanction 

award to two-thirds of J.C. Penney’s incurred attorney’s fees after 

Oxford discovered its Delaware citizenship.3 Oxford argues that 

3 We reject the argument that because the limitation had a dual purpose—

both avoiding an award for fees that J.C. Penney would have incurred anyway 

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the district court erred by not “‘assessing and allocating specific 

litigation expenses’ as the but-for standard ‘demands.’” But there 

is no such “demand.” Oxford’s suggestion to the contrary ignores 

Goodyear’s explicit qualifications of the general approach it 

outlined. The Supreme Court went out of its way to caution that 

district courts need not parse every single litigation expense with a 

fine-tooth comb. Goodyear, 581 U.S. at 110. Here, the district court 

considered its “overall sense of [the] suit,” “use[d] estimates,” and 

concluded that “a set percentage” (two-thirds) “of a particular 

category of expenses” (those incurred after Oxford should have 

dismissed the case) were “incurred solely because of [Oxford’s] 

bad-faith conduct.” Id. We owe this judgment substantial 

deference on appeal. Id. 

Ultimately, Oxford cries foul about the district court shifting 

fees in a manner explicitly blessed by the Supreme Court. We 

reject its attempt to characterize the district court’s action as 

anything else. The district court did not abuse its considerable 

discretion in determining the amount of fees owed to J.C. Penney.4

and accounting for J.C. Penney’s responsibility—it did not independently 

satisfy either one.

4 Oxford also argues that the district court erred by refusing to apply the 

“excess costs” framework from Amlong & Amlong, P.A. v. Denny’s, Inc., 500 F.3d 

1230 (11th Cir. 2007). But Amlong only analyzed the permissibility of sanctions 

under 28 U.S.C. § 1927. 500 F.3d at 1239–42. And this Court has previously 

admonished lower courts for “blurr[ing] the lines between the inherent power 

standard and the standard used for Rule 11 and § 1927 sanctions.” Purchasing 

Power, 851 F.3d at 1223 n.4. “While these powers can be used to punish the 

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V.

We also conclude that the district court did not abuse its 

discretion when it sua sponte struck Oxford’s affidavit as untimely 

and irrelevant. 

On June 24, 2021, after both parties had moved for sanctions, 

the district court ordered reply briefs to be filed no later than July 

6, with a hearing twenty days later on whether the court should 

impose sanctions. Both parties complied with the filing deadline, 

and the court held the hearing. On August 5, it granted J.C. 

Penney’s motion in part and imposed sanctions on Oxford.

Though the court had decided that sanctions were in order, 

the amount was not yet determined. So the court’s next order 

directed J.C. Penney to outline its legal fees and Oxford to brief the 

reasonableness of those amounts. Seeing an opportunity, Oxford 

filed an affidavit from its attorney, Grovenstein, in addition to its 

brief. But this affidavit did not mention J.C. Penney’s fees at all, let 

alone the reasonableness of those fees. Instead, it contained a

protracted merits discussion of how Grovenstein (and by 

extension, Oxford) did not act in bad faith. The district court 

refused to consider it. The affidavit, the court concluded, bore 

“only on whether the court should impose sanctions at all—not the 

amount of fees,” which was the only issue pending at the time.

same areas of conduct, they are not governed by the same standard.” Id. The 

district court did not err by refusing to apply an incorrect standard.

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We see no problem—a district court is not required to 

consider irrelevant evidence. Cf. United States v. Hall, 653 F.2d 1002, 

1005 (5th Cir. 1981).5 Because Grovenstein’s affidavit had nothing 

to do with the amount of fees recoverable, the district court had no 

reason to assess it. 

What’s more, even if the affidavit had been relevant, it was 

untimely. The Federal Rules of Civil Procedure provide that “any 

opposing affidavit must be served at least 7 days before the 

hearing,” unless the court allows otherwise. Fed. R. Civ. P. 6(c)(2). 

Oxford did not file Grovenstein’s affidavit until August 19, 2021—

forty-four days after its pre-hearing briefing deadline and twentyfour days after the sanctions hearing. “Absent an affirmative 

showing by the non-moving party of excusable neglect,” a “court 

does not abuse its discretion in refusing to accept out-of-time 

affidavits.” Useden, 947 F.2d at 1571 (quotation omitted). Oxford 

made no such showing here. In fact, it did not even argue for

excusable neglect, admitting at oral argument that not filing sooner

was a “strategic decision.”

No matter how Oxford tries to reframe the issue, the district 

court’s refusal to allow the overdue and irrelevant affidavit to 

function as the equivalent of a motion for reconsideration was not 

an abuse of discretion.

5 Decisions by the former Fifth Circuit handed down before October 1, 1981,

are binding on this Court. Bonner v. City of Prichard, 661 F.2d 1206, 1207 (11th 

Cir. 1981) (en banc).

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* * *

This case offers a textbook example of bad faith. Undeterred

after discovering that the district court lacked jurisdiction, Oxford 

decided to withhold that fact and try its hand at the merits. When

those merits efforts failed, Oxford pulled out the diversitydestroying card. And when jurisdiction vanished, so did all the 

unfavorable rulings. We do not take this kind of jurisdictional 

manipulation lightly. We therefore AFFIRM the award of 

sanctions.

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