From Ready Transportation, Inc. v. Available Shippers, Inc., 2010 U.S. App. LEXIS 24431 (9th Cir. Oct. 6, 2010):

Ready sued AAR and others***. All defendants except AAR were dismissed from the case in its early stages. Ready and AAR then settled their dispute under the terms of a confidential settlement agreement. They stipulated to dismissal of all claims except for a disagreement over attorney's fees. The District Court dismissed the balance of the case with prejudice, and it "retain[ed] jurisdiction solely for the purpose of hearing and ruling upon Plaintiffs' application re legal entitlement to attorney's fees."

In support of its motion for fees, Ready attempted to file the confidential settlement agreement under seal, but the District Court denied the request and returned the document to Ready. Two days later, Ready filed the confidential settlement agreement on the public docket. AAR then filed a motion to strike the confidential settlement agreement. The District Court denied AAR's motion because the "parties' dispute over . . . the confidentiality of the settlement agreement" placed a motion to strike "outside the scope of the [Court's] retained jurisdiction." The fee dispute was later resolved by the District Court in AAR's favor, and timely cross-appeals were filed. ***

We conclude that the District Court had jurisdiction to grant the motion to strike pursuant to its inherent powers. The inherent powers are mechanisms for "control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases." Chambers, 501 U.S. at 43 (citations omitted).

"It is well established that '[d]istrict courts have inherent power to control their docket.'" Atchison, Topeka & Santa Fe Ry. v. Hercules, Inc., 146 F.3d 1071, 1074 (9th Cir. 1998) (alteration in original)***. This includes the power to strike items from the docket as a sanction for litigation conduct. See, e.g., Lazy Y Ranch Ltd. v. Behrens, 546 F.3d 580, 586-87, 588 (9th Cir. 2008) (discussing, but declining to rule on, the ability of a district court to strike documents submitted as exhibits to a motion); Hambleton Bros. Lumber Co. v. Balkin Enters., Inc., 397 F.3d 1217, 1224-26 (9th Cir. 2005) (upholding a district court's grant of a motion to strike deposition corrections and a declaration as a sanction when a party had violated Fed. R. Civ. P. 30(e)); cf. Carrigan v. Cal. State Legislature, 263 F.2d 560, 564 (9th Cir. 1959) (discussing an appellate court's inherent power to strike briefs and pleadings "as either scandalous, impertinent, scurrilous, and/or without relevancy"). Even though the District Court retained only limited jurisdiction over a portion of the suit, that did not deprive it of the ability to exercise its inherent powers "necessary to the exercise of all others," including the "power to impose silence, respect, and decorum." Chambers, 501 U.S. at 43.

Indeed, the inherent powers permit a district court to go as far as to dismiss entire actions to rein in abusive conduct. See Atchison, 146 F.3d at 1074 (recognizing inherent power to dismiss an action to sanction abusive conduct such as judge-shopping or failure to prosecute). It necessarily follows that, as part of its power to "manage [its] own affairs," Chambers, 501 U.S. at 43, a district court can use less drastic measures such as striking documents from the docket to address litigation conduct that does not warrant outright dismissal. See id. at 44-45 ("Because of their very potency, inherent powers must be exercised with restraint and discretion. A primary aspect of that discretion is the ability to fashion an appropriate sanction for conduct which abuses the judicial process." (citations omitted)); Thompson v. Hous. Auth. of Los Angeles, 782 F.2d 829, 830 (9th Cir. 1986) (per curiam) (requiring a district court to weigh, among other factors, "the availability of less drastic sanctions" before resorting to dismissal as a sanction); Henderson v. Duncan, 779 F.2d 1421, 1423 (9th Cir. 1986) ("Dismissal is a harsh penalty and is to be imposed only in extreme circumstances."); Anderson v. Air W., Inc., 542 F.2d 522, 525 (9th Cir. 1976) (upholding dismissal where a district court "concluded that 'no lesser measure would repair the damage plaintiff has done (to the defendants)' ").

In light of the powers district courts possess to craft an appropriate sanction for litigation conduct and, as well, to determine what appears in the court's records, we therefore hold that the District Court erred when it concluded it was powerless to strike the confidential settlement agreement from the public docket.