Courts generally presume that a lawsuit has been filed in good faith, and a party moving for sanctions against the party who filed a lawsuit or claim must overcome this presumption to prove abuse of the judicial process. Thus, courts distinguish between (1) claims that are ultimately found to be merely groundless (and thus not sanctionable) and (2) claims that are ultimately found to be both groundless and brought in bad faith or for the purpose of harassment (and thus sanctionable). The sanctions rules generally do not require a party or its attorney to be right; they require the party or its attorney to make a reasonable inquiry into the facts and the laws related to the claims.

Contempt of court is broadly defined as disobedience to or disrespect of a court by acting in opposition to its authority. Contempt of court may be punished by the court with civil and criminal sanctions or penalties.

In North Carolina, the legal system operates under the assumption that lawsuits are filed with legitimate intentions. When a party seeks sanctions against another for filing a lawsuit, they bear the burden of proving that the lawsuit constitutes an abuse of the judicial process. North Carolina courts make a clear distinction between claims that are unfounded but not subject to sanctions, and those that are not only unfounded but also filed in bad faith or with the intent to harass, which can be sanctioned. The rules regarding sanctions do not demand that a party or their attorney be correct in their claims, but rather that they have conducted a reasonable investigation into the facts and laws before proceeding with the claim. Contempt of court in North Carolina encompasses acts of disobedience or disrespect towards the court's authority, and can result in either civil or criminal penalties, depending on the nature of the contempt. This can include fines, imprisonment, or other measures the court deems appropriate to compel compliance with its orders or to punish for the contemptuous behavior.