Deterrence. This was made clear in the 1993 amendments to Rule 11 and the Advisory Committee Notes accompanying it. The rule itself in part (c) (4) states that the sanction must only be what is necessary to achieve deterrence; moreover, it specifically states that if a violator is required to pay "part or all" of the attorney fees directly attributable to the violation, such a sanction may only be made only if warranted to achieve effective deterrence. Thus, the rule envisions that fee shifting will be rare. The Advisory Committee Notes go on to state, in Paragraph 13, that the even when some amount of fee shifting is ordered, it is appropriate for the court to exercise discretion, taking into account, among other things, whether the person sanctioned has "modest financial resources."
Also, as I mentioned in my earlier post about the Texas Legislature's "loser pays" bill, sanctions for filing frivolous litigation are also subject to a Constitutional threshold. In Professional Real Estate Investors, Inc. v. Columbia Pictures, Inc., 508 U.S. 49 (1993), as interpreted by subsequent cases such as iLOR v. Google, Inc., 631 F. 3d 1372 (Fed. Cir. 2011), the Court forbids punishing counsel for filing allegedly frivolous cases unless the case is "objectively baseless." "Objective baselessness" is then defined as applying only to a case where "no reasonable litigant could realistically expect to succeed on the merits." Thus, if the case is less "frivolous" than that standard, imposition of any sanctions would violate the First Amendment right to petition the government for redress of grievances.
The real heyday for fee shifting and other very punitive sanctions under Rule 11 was 1983 to 1993. The Fifth Circuit, for instance, has not affirmed a fee shifting sanction under Rule 11 subsequent to the 1993 rule amendment.