--- /dev/null
+From b7f8a09f8097db776b8d160862540e4fc1f51296 Mon Sep 17 00:00:00 2001
+From: Jan Kara <jack@suse.cz>
+Date: Thu, 22 Jun 2017 15:31:07 +0200
+Subject: btrfs: Don't clear SGID when inheriting ACLs
+
+From: Jan Kara <jack@suse.cz>
+
+commit b7f8a09f8097db776b8d160862540e4fc1f51296 upstream.
+
+When new directory 'DIR1' is created in a directory 'DIR0' with SGID bit
+set, DIR1 is expected to have SGID bit set (and owning group equal to
+the owning group of 'DIR0'). However when 'DIR0' also has some default
+ACLs that 'DIR1' inherits, setting these ACLs will result in SGID bit on
+'DIR1' to get cleared if user is not member of the owning group.
+
+Fix the problem by moving posix_acl_update_mode() out of
+__btrfs_set_acl() into btrfs_set_acl(). That way the function will not be
+called when inheriting ACLs which is what we want as it prevents SGID
+bit clearing and the mode has been properly set by posix_acl_create()
+anyway.
+
+Fixes: 073931017b49d9458aa351605b43a7e34598caef
+CC: stable@vger.kernel.org
+CC: linux-btrfs@vger.kernel.org
+CC: David Sterba <dsterba@suse.com>
+Signed-off-by: Jan Kara <jack@suse.cz>
+Signed-off-by: David Sterba <dsterba@suse.com>
+Signed-off-by: Nikolay Borisov <nborisov@suse.com>
+Signed-off-by: Greg Kroah-Hartman <gregkh@linuxfoundation.org>
+---
+ fs/btrfs/acl.c | 13 +++++++------
+ 1 file changed, 7 insertions(+), 6 deletions(-)
+
+--- a/fs/btrfs/acl.c
++++ b/fs/btrfs/acl.c
+@@ -82,12 +82,6 @@ static int __btrfs_set_acl(struct btrfs_
+ switch (type) {
+ case ACL_TYPE_ACCESS:
+ name = POSIX_ACL_XATTR_ACCESS;
+- if (acl) {
+- ret = posix_acl_update_mode(inode, &inode->i_mode, &acl);
+- if (ret)
+- return ret;
+- }
+- ret = 0;
+ break;
+ case ACL_TYPE_DEFAULT:
+ if (!S_ISDIR(inode->i_mode))
+@@ -123,6 +117,13 @@ out:
+
+ int btrfs_set_acl(struct inode *inode, struct posix_acl *acl, int type)
+ {
++ int ret;
++
++ if (type == ACL_TYPE_ACCESS && acl) {
++ ret = posix_acl_update_mode(inode, &inode->i_mode, &acl);
++ if (ret)
++ return ret;
++ }
+ return __btrfs_set_acl(NULL, inode, acl, type);
+ }
+