Mathison v. Berkebile

Filing 21

MEMORANDUM OPINION AND ORDER denying without prejudice 6 Motion to Dismiss for Lack of Jurisdiction (Respondent is allowed to brief the issue of judicial estoppel by December 31, 2013); granting 12 Motion for Leave to Proceed in forma pauperis; holding in abeyance 4 Motion for Bail pending the Court's consideration of Respondent's submission regardinge estoppel. Signed by U. S. District Judge Lawrence L. Piersol on 12/20/13. (Attachments: # 1 9/17/08 Mathison pro se petition pursuant to 28 USC 2241, # 2 10/14/08 Oppotision to Motion for Release in Mathison v. Wiley, # 3 3/26/09 Order and Judgment in Mathison v. Wiley) (DJP)

UNITED STATES DISTRICT COURT

DEC 20 2013

DISTRICT OF SOUTH DAKOTA

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SOUTHERN DIVISION

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EUGENE H. MATHISON,
CIV. 12-4156
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Petitioner,
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MEMORANDUM OPINION
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- vs ­
AND ORDER
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DAVID BERKEBILE, Warden,
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Respondent.
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Eugene H. Mathison, by his counsel ofrecord, has filed a Petition for Writ ofHabeas Corpus
under 28 U.S.C. § 2241 raising concerns as to whether his conviction and sentence for both money
laundering and fraud is valid under the holding of United States v. Santos, 553 U.S. 507 (2008).
Doc. 1. The Respondent filed a Motion to Dismiss arguing that this Court has no jurisdiction over
Mathison's habeas petition because it should have been filed in the District of Colorado where
Mathison is incarcerated and his custodian is located. Doc. 6.

This Court refused to grant

Respondent's motion to stay a response on the merits reasoning that even ifthe Court were to find
in favorofthe Respondent on the issue ofthe correct district to bring this action, the Court could still
consider it to be in the interest ofjustice to transfer the action pursuant to 28 U.S.c. § 1406(a) or to
continue the appointment of counsel to pursue an appropriate remedy, and wanted input from the
Government on the merits of the Santos claim. In its subsequent response Respondent argues that
Mathison has failed to make a showing that he is entitled to raise the Santos issue on collateral
review. Doc. 14. With regard to the merits ofMathison's claim ofbeing convicted of conduct the
law does not make criminal, the Respondent merely states Mathison's claim is "a point the
Government does not concede." Doc. 14, p. 17. The matter has now been fully briefed and the Court
has reviewed the voluminous trial record.

PROCEDURAL BACKGROUND

Indictment and Trial
In 1996, the Government in a 25-page Second Superseding Indictment charged Eugene
Mathison and three others, Robert E. HoImes, Perry Gobel, and Dean Chambers, with numerous
counts of conspiracy (18 U.S.C. § 371), mail fraud (18 U.S.C. § 1341), wire fraud (18 U.S.C.
§ 1343), and money laundering (18 U.S.C. §§ 1956(a)(1),and 1957(a)). UnitedStatesv.Mathison,

et ai, 4:96-cr-40048 (Doc. 144). The Government alleged that Mathison was operating a Ponzi
scheme and defrauded family, friends, and acquaintances of over $1 million. Included within this
Ponzi scheme were four different investment groups: Northern States Investment Group, GoldStar
Investment Group, Universal Investment Group, and Perob Investment Group.
Each ofthe money laundering counts required the Government to prove that Mathison knew
that the money utilized to conduct a financial transaction represented the "proceeds" of some form
of unlawful activity. In the definition portion ofInstruction No. 31 the Court defined proceeds as
follows:
The term "proceeds" means any property, or any interest in property, that someone
acquires or retains as a result of the commission of the mail fraud or wire fraud. If
someone commits a fraud and receives cash or a check and uses the cash or check to
buy a cashier's check, the cash or check received is proceeds and the cashier's check
is still proceeds of the crime. The government is not required to trace the property
it alleges to be proceeds ofmail fraud or wire fraud to a particular underlying offense.
It is sufficient if the government proves that the property was the proceeds of mail
fraud or wire fraud generally.
The government need not prove that all of the property involved in the transaction
was the proceeds ofmail fraud or wire fraud. It is sufficient ifthe government proves
that at least part ofthe property represents such proceeds.
Mathison, who represented himself at trial, did not object to Instruction No. 31. In addition, none
ofthe attorneys representing Mathison's co-defendants objected to this instruction.
A jury trial commenced on May 20, 1997, and on June 9, 1997, a jury convicted Mathison
ofthirty-eight counts ofmail fraud, five counts of wire fraud, fifteen counts ofmoney laundering in
violation of18 U.S.C. §§ 1956(a)(l), one count ofconspiracy to commit mail fraud, wire fraud, and
money laundering, and two counts of engaging in monetary transactions in property derived from

2

unspecified unlawful activity in violation of 18 U.S.C. § 1957 (Doc. 378). By a judgment dated
September 12, 1997, Mathison was sentenced to a total term of imprisonment of246 months:

Post-trial
Mathison appealed from his conviction and sentence to the United States Court of Appeals
for the Eighth Circuit, but did not raise any issue regarding the definition of proceeds under the
money-laundering statutes.

See United States v Mathison, 157 F.3d 541 (8th Cir. 1998).2

Mathison's convictions and sentence were affirmed, and the Supreme Court denied Mathison's
petition for a writ of certiorari on January 11, 1999.
On April 3, 2000, Mathison filed his first Motion to Vacate, Set Aside, or Correct Sentence
under 28 U.S.c. § 2255. CIV. 00-4055. In his initial and initial amended Section 2255 motion,
Mathison did not raise any issue regarding the definition of proceeds. District Judge Richard H.
Battey denied the Section 2255 motion after finding it was barred by the one-year state oflimitations.
The Eighth Circuit, on March 21, 2001, denied Mathison's application for a certificate of
appealability and dismissed his appeal from the denial ofhis Section 2255 motion.

IThe judgment specified that Mathison would be imprisoned 235 months on Counts 1
through 61, all such terms of imprisonment to run concurrently, and that as to each of Counts 42,
43, 44, 49 50, 52, and 57 through 61, Mathison was to be imprisoned for an additional term of
one month pursuant to 18 U.S.C. § 3147, each one-month sentence enhancement to run
consecutively to each other enhancement and consecutively to the 235 months of imprisonment
imposed on counts 1 through 61. United States v. Mathison, et ai, 4:96-cr-40048 (Doc. 470).
2In his appeal Mathison raised the following issues: (1) judicial bias; (2) error in denying
motions to suppress evidence; (3) error in denying Franks hearing; (4) deficient supporting
affidavit for search warrant; (5) lack of specificity in search warrant; (6) error in refusing to force
the government to allow him to examine seized property; (6) error in refusing to grant immunity
to a witness; (6) sentencing errors; (7) the sentence constitutes cruel and unusual punishment; and
(8) ineffective assistance of counsel in pretrial matters.
3

I.

WHETHER MATHISON HAS PRESENTED A CLAIM THAT CAN BE PRESENTED

BY UTILIZING THE SAVINGS CLAUSE OF § 2255 AND FILING A PETITION FOR A

WRIT OF HABEAS CORPUS UNDER 28 U.S.c. § 2241?

United States v. Santos
United Statesv. Santos, 553 U.S. 507 (2008), was decided on June 2, 2008. 3 The Santos case
involved an illegal lottery, in which runners took commissions between 15% and 25% from the bets
they gathered, and some ofthe rest ofthe money was paid as salary to collectors and to the winning
gamblers. Based on the payments to runners, collectors, and winners, Santos, who ran the lottery,
was convicted of violating the federal money-laundering statute, 18 U.S.C. § 1956. Another
defendant pleaded guilty to conspiracy to launder money, based on his receipt 0 f salary. The Seventh
Circuit affirmed these convictions. On collateral review, the district court ruled that under intervening
Circuit precedent in the Seventh Circuit which interpreted the word "proceeds" in the federal
money-laundering statute as applying only to transactions involving criminal profits, not criminal
receipts, there was no evidence that the transactions on which the money-laundering convictions were
based involved lottery profits. The district court vacated those convictions, and the Seventh Circuit
affirmed the order ofthe district court. In a plurality opinion, the Supreme Court in Santos affirmed
the Seventh Circuit.
Justice Scalia delivered the plurality opinion in which Justice Souter and Justice Ginsburg
joined, and in which Justice Thomas joined as to all but Part IV.4 The plurality opinion observed that

3Respondent states: "Mathison's first attempt to raise the Santos issue, in a habeas filed in
January, 2008," was rejected by the Colorado district court and the Tenth Circuit. Doc. 14, p. 15.
At this time, however, the Supreme Court had not decided the Santos case.
4Part IV of the opinion written by Justice Scalia criticizes Justice Stevens' opinion for
expressing the view that the rule oflenity applied to the case at hand because there is no
legislative history reflecting any legislator's belief concerning the application of the
money-laundering statute to lottery operators, and for Justice Stevens distinguishing the case at
hand from cases involving organized crime or the sale of contraband with regard to the
application ofthe rule oflenity. Santos, 553 U.S. at 521-522.

4

since the federal money-laundering statute did not define "proceeds,,5 the term could mean either
"receipts" or ''profits.'' The plurality opinion also observed that Congress has defined "proceeds" in
various criminal provisions, sometimes to mean "receipts" and sometimes to mean "profits." The
plurality opinion opined that either definition made sense in the context of the money-laundering
statute. Santos, 553 U.S. at 511-512.
The plurality opinion concluded that "[b ]ecause the 'profits' definition of'proceeds' is always
more defendant-friendly than the 'receipts' definition, the rule oflenity dictates that it should be
adopted." Santos, 553 U.S. at 514. The plurality opinion reasoned that ifthe proceeds were defined
as receipts, the statute criminalizing illegal lotteries would merge with the money-laundering statute.
The plurality opinion further opined that the merger problem would apply to a host of predicate
crimes, "depend[ing] on the manner and timing of payment for the expenses associated with the
commission of the crime." Santos, 553 U.S. at 516. The plurality opinion specifically noted: "And
any wealth-acquiring crime with multiple participants would become money laundering when the
initial recipient 0 fthe wealth gives his confederates their shares." Id. The plurality opinion states that
an interpretation of "proceeds" to mean "profits" would eliminate the merger problem.
In his concurring opinion, Justice Stevens opined that "Congress could have provided that the
term 'proceeds' shall have one meaning when referring to some specified unlawful activities and a
different meaning when referring to others." Santos, 553 U.S. at 525. Justice Stevens observed that
the legislative history of § 1956 makes it clear that Congress intended the term "proceeds" to include
gross revenues from the sale ofcontraband and the operation oforganized crime syndicates involving
the sale of contraband, and opined that the rule oflenity need not apply to those types of activities.

Santos, 553 U.S. at 525-526 n.3. Justice Stevens in his opinion also expressed concern over the
merger problem and stated: "Allowing the Government to treat the mere payment ofthe expense of
operating an illegal gambling business as a separate 0 ffense is in practical effect tantamount to double
jeopardy, which is particularly unfair in this case because the penalties for money laundering are

5After Santos was decided Congress in 2009 amended § 1956 to define "proceeds" as "any
property derived from or obtained or retained, directly or indirectly, through some form of
unlawful activity, including the gross receipts of such activity." That amendment, however,
would not apply retroactively to Mathison's case.

5

substantially more severe than those for the underlying offense of operating a gambling business."
Santos, 553 U.S. at 527. Justice Stevens further opined: ''The revenue generated by a gambling
business that is used to pay the essential expenses ofoperating that business is not 'proceeds' within
the meaning ofthe money laundering statute." 553 U.S. at 528.
When a fragmented Supreme Court, such as the Supreme Court in the Santos decision,
decides a case and no single rationale explaining the result enjoys the assent of five Justices, the
holding ofthe Supreme Court may be viewed as the position taken by those members who concurred
in the judgments on the narrowest grounds. Marks v. United States, 430 U.S. 188,193 (1977);
United States v. Ollie, 442 F.3d 1135, 1142 (8th Cir. 2006). In the Santos decision, Justice Stevens'
opinion resolved the case on the narrowest grounds and sets forth the Court's holding.
The Eighth Circuit first addressed the Santos decision in United States v. Spencer, 592 F.3d
866 (8th Cir. 201 0), a case in which one ofthe defendants was convicted ofconspiracy to distribute
cocaine, attempted possession with intent to distribute cocaine, and money laundering. In the
Spencer case, the Eighth Circuit stated: "Santos holds that, in the context ofa gambling organization,
the word ''proceeds'' in the money-laundering statute refers to profit, not gross revenue." 592 F.3d
at 879. The Eighth Circuit held in Spencer that Santos does not apply in the drug context. 592 F.3d
at 879-880; see also United States v. Davis, 690 F.3d 912, 921 n.3 (8th Cir. 2012), cert. granted,
judgment vacated on other grounds, 133 S.Ct. 2852 (2013). In United States v. Rubashkin, the
Government unsuccessfully argued that under Spencer the Santos holding was limited to illegal
gambling cases. 655 F.3d 849, 865 (8th Cir. 2011).6 In Rubashkin the Eighth Circuit acknowledged
that Courts of Appeals in Garland v. Roy, 615 F.3d 391 (5th Cir. 2010), and United States v. Van
Alstyne, 584 F.3d 803 (9th Cir. 2009), had held the merger problem recognized by Justice Stevens'
opinion in Santos could exist in pyramid and Ponzi scheme cases because the same transactions gave

6The Eighth Circuit in Rubashkin, 655 F.3d at 849, explained:
The government's argument limiting Santos to illegal gambling cases is supported
by a footnote in United States v. Spencer, 592 F.3d 866, 879 n. 4 (8th Cir.201 0).
That footnote read alone implies that Santos only applies to illegal gambling cases,
but read in the context of the opinion it merely indicated that Santos "does not
apply in the drug context." Id. at 879-80. Spencer involved drug trafficking, a
type of activity which the controlling opinion in Santos stated was always
separately punishable from money laundering.
6

rise to both the underlying fraud charges and those for money laundering. The Eighth Circuit
distinguished those cases from that of the defendant in Rubashkin because the money laundering
charges in his case were not predicated solely on his bank fraud charges, but were also predicated on
charges 0 f making false statements and reports to a bank in vio lation 0 fl8 U. S. C. § 1014. Rubashkin,
655 F.3d at 865-866.

Application ofSantos on Collateral Review
Although immediately following the issuance ofthe decision in United States v. Santos, 553
U.S. 507 (2008), numerous district courts concluded that the new definition of proceeds in the
money-laundering statues was not retroactively applicable, see Wooten v. Cauley, 677 F.3d 303,308
(6th Cir. 2012), several Circuit Courts have subsequently ruled that Santos is retroactively applicable.
These rulings are based on the new interpretation of the definition of "proceeds" in § 1956 being a
substantive change in the law which places the burden on the prosecution to prove the use ofprofits,
not mere gross receipts, in money laundering cases. See Wooten v. Cauley, 677 F.3d at 308.
(abrogating Haukedahl v. United States, 2009 WL 961157 (N. D. Ohio, April 7, 2009». See also

Bousley v. United States, 523 U.S. 614, 620 (1998) (the rule in Teague v. Lane, 489 U.S. 288
(1989), that new constitutional rules ofcriminal procedure are generally inapplicable to cases which
have become final before the announcement of the new rules are announced is not applicable to a
situation in which the Supreme Court decides the meaning ofa criminal statute enacted by Congress).
In Reyes-Requena v. United States, 243 F.3d 893 (5th Cir. 2001), the Fifth Circuit Court of
Appeals considered what mechanism a federal prisoner should utilize to bring a claim based on Bailey
v. United States, 516 U.S. 137 (1995). Bailey holds that a conviction under 18 U.S.C. § 924(c)(I),
which crirninalizes the ''use'' of a firearm during and in relation to drug trafficking offense, requires
evidence sufficient to show active employment of a firearm by a defendant. The Fifth Circuit in

Reyes-Requena was confronted with orders from two district courts, with each district court
concluding that the other properly had jurisdiction over the Bailey post-conviction claim One district
court concluded that the federal prisoner needed to file a successive § 2255 motion and the other
district court concluded that the federal prisoner must file claim under § 2241. The Fifth Circuit
concluded that the Supreme Court in Bailey conducted a routine statutory analysis, not a new rule

7

ofConstitutional law, and that the Bailey claim, therefore, did not fall within the rubric ofsuccessive

§ 2255 motions. Reyes-Requena, 243 F.3d at 900.
The Fifth Circuit in Reyes-Requena then considered whether the Bailey claim could be
considered under 28 U.S.C. § 2241 by utilizing the savings clause of28 U.S.C. § 2255. The savings
clause, codified at 28 U.S.c. § 2255(e), provides:

An application for a writ of habeas corpus in behalf of a prisoner who is authorized
to apply for relief by motion pursuant to this section, shall not be entertained if it
appears that the applicant has failed to apply for relief, by motion, to the court which
sentenced him, or that such court has denied him relief, unless it also appears that the
remedy by motion is inadequate or ineffective to test the legality of his detention. 7
After considering the statutory language, cases interpreting the same, and the fact that the provision
under 28 U.S.C. § 2255 allowing for successive habeas review "does not provide any avenue through
which a petitioner could rely on an intervening Court decision based on the substantive reach of a
federal statute," 243 F.3d at 903, the Fifth Circuit in Reyes-Requena concluded:
[T]he savings clause of § 2255 applies to a claim (i) that is based on a retroactively
applicable Supreme Court decision which establishes that the petitioner may have
been convicted of a nonexistent offense and (ii) that was foreclosed by circuit law at
the time when the claim should have been raised in the petitioner's trial, appeaL or first
§ 2255 motion.

Reyes-Requena, 243 F.3d at 904.
The Eighth Circuit has recognized that although a federal inmate generally must challenge a
conviction or sentence through a § 2255 motion, the savings clause governing motions to vacate, set
aside, or correct a sentence permits a prisoner to bring a habeas petition under § 2241 ifthe remedy
available in a motion to vacate is inadequate or ineffective to test the legality of a conviction or a
sentence. Lopez-Lopez v. Sanders, 590 F.3d 905, 907 (8th Cir. 2010); United States v. Lurie, 207
F.3d 1075, 1077 (8th Cir. 2000). The prisoner has the burden of establishing that the remedy under
Section 2255 would be inadequate or ineffective. Hill v. Morrison, 349 F.3d 1089, 1091 (8th Cir.
2003).

The Supreme Court in United States v. Hayman, 342 U.S. 205,223 (1952), also
observed that habeas corpus writs are available when § 2255 is inadequate or ineffective.
7

8

In Abdullah v. Hedrick, 392 F.3d 957, 960 (8th Cir. 2004), a case cited by Respondent, a
federal prisoner unsuccessfully attempted to utilize the savings clause of § 2255 and a petition for a
writ of habeas corpus under 28 U.S.C. § 2241 to assert a Bailey challenge to a conviction arising
from a plea to the use ofa firearm under 18 U.S.C. § 2241. The Eighth Circuit looked to the Fourth
and Fifth Circuits for guidance as to when § 2255 may be inadequate or ineffective to test the legality
of a conviction. Abdullah v. Hedrick, 392 F.3d at 962 (citing In re Jones, 226 F.3d 328 (4th Cir.
2000); and Reyes-Requena v. United States, 243 F.3d 893 (5th Cir. 2001». These cases allow the
use of § 2241 through the savings clause of § 2255 when a petitioner asserts a viable claim of actual
innocence, but the petitioner had not had an earlier procedural opportunity to raise the claim. As was
previously discussed, in Reyes-Requena v. United States, 243 F.3d at 904, the Fifth Circuit held that
the savings clause of28 U.S.C. § 2255 applies to a claim (1) ifthe claim is based on a retroactively
applicable Supreme Court decision which establishes that a petitioner may have been convicted of a
nonexistent offense and (2) if the claim was foreclosed by circuit law at the time when the claim
should have been raised in the petitioner's trial, appeal, or first § 2255 motion.
In Abdullah v. Hedrick, the prisoner's first § 2255 motion was pending at the time the
Supreme Court announced its decision in Bailey, but the prisoner's counsel failed to amend the

§ 2255 motion, and the Eighth Circuit held on appeal from the denial ofthe initial § 2255 motion that
the prisoner had defaulted the Bailey argument by not properly presenting the argument to the district
court in his initial § 2255 motion. Abdullah v. Hedrick, 392 F.3d at 959. The Eighth Circuit
concluded that the prisoner in Abdullah v. Hedrick had an unobstructed procedural opportunity to
present his claim. 392 F.3d at 963. In addition, the Eighth Circuit noted: "To make an actual
innocence showing, Abdullah would have to prove 'not only actual innocence ofthe gun charge but
also of the more serious charges the government dismissed in exchange for the guilty plea.' " 392
F.3d at 959 n.2. Mathison's case does not present such barriers to savings clause relief
In bringing a claim based on Santos, Mathison has presented a claim based on a retroactively
applicable Supreme Court decision which establishes that he may have been convicted of a
nonexistent offense. In addition, he has presented a claim that was foreclosed by the circuit law of
the Eighth Circuit at the time when his claim should have been raised in his trial, appeal, or first

§ 2255 motion. His petition for certiorari from the appeal of his conviction was denied more than
9

nine years before the Supreme Court issued its decision in Santos.
In United States v. Williams, the Eighth Circuit acknowledged that under its case law prior
to the Supreme Court handing down its decision in Santos "proceeds" was defined as "anything that
is the gross receipt of illegal activity." 605 F.3d 556, 567 (8th Cir. 201 0) (citing United States v.

Simmons, 154 F.3d 765, 770 (8th Cir.1998) (noting that while other circuits have defined the term
"proceeds" as alternatively gross revenue or profit, "[ w]e think the better view is the one that defines
proceeds as the gross receipts of the illegal activity"). Although Santos is retroactively applicable,
Mathison's Santos claim was foreclosed by Eighth Circuit law at the time ofpetitioner's trial, appeal,
and first § 2255 motion. Mathison presents a case in which he was convicted ofmoney laundering
in violation of 18 U.S.C. § 1956 involving funds transferred by wire and paid to his codefendants,
coconspirators, and associates, Perry Gobel, Robert Holmes, Robert Holmes'wife, and Dean
Chambers. 8 Counts 54,55,56,57 and 58. In rejecting proceeds as being mere receipts, the Santos
opinion observed, "And any wealth-acquiring crime with multiple participants would become money
laundering when the initial recipient of the wealth gives his confederates their shares." Santos, 553
U.S. at 515. This is what occurred in some ofthe counts ofmoney laundering for which Mathison
was convicted. Since Mathison's § 2241 petition presents viable Santos challenges to a number of
his money laundering convictions, Mathison presents a savings clause case under 28 U. S. C. § 2255 (e)
which can be brought under § 2241. The issue becomes whether Mathison can bring his claim in this
district court.

Mathison's Assertion ofthe Application ofSantos to his Case
Santos was announced on June 2,2008. In September of2008, Mathison, while incarcerated
at the Federal Prison Camp in Florence, Colorado, filed a pro se petition, pursuant to 28 U.S.C.

§ 2241, and citing to 28 U.S. C. § 225 5( e), challenged the validity ofhis money laundering conviction
under the law as set forth in Santos. See attachment 1. The application was dismissed because the
district court, construing the action as a challenge to Mathison's South Dakota conviction, concluded

8The Court notes that Dean Chambers, unlike the other associates, testified that he cashed
all the checks which were made payable to him and gave the cash to Mathison. Trial Transcript, p.
1066.
10

that Mathison had "an adequate and effective remedy pursuant to 28 U.S.C. § 2255 in the United
States District Court for the District of South Dakota." See Eugene H. Mathison v. Ron Wiley, No.
08-CV-2005, 2008 WL 4569864 (D. Colo. October 1, 2008). In the opposition to Mathison's
motion for release pending review, the predecessor to the current respondent represented to the
Tenth Circuit: "Mathison commenced this action under 28 U.S.c. § 2241. As the court correctly
observed, however, because this action challenges the validity ofthe original conviction and sentence,
it is properly brought pursuant to § 2255 in the district in which the conviction and sentence were
imposed." See attachment 2. On March 26,2009, the United States Court ofAppeals for the Tenth
Circuit affirmed the order denying Mathison's application for under 28 U.S.C. § 2241. Mathison v.
Wiley, 318 Fed. Appx. 650,2009 WL 784257 (10th Cir. March 26,2009). See Attachment 3. In

May of 2009, Mathison then filed a Petition for Writ of Audita Querela challenging his money
laundering convictions under Santos. This Court denied the Petition for Writ of Audita Querela,
determining that a "writ 0 f audita querela cannot be invo ked simply to enable a defendant to file what
is in effect a § 2255 motion without complying with the rules governing such motions, or to file a
second § 2255 without the requisite permission ofthe Court ofAppeals." United States v. Mathison,
2010 WL 2932957 at *4 (D.S.D. July 23, 201 0). Because this Court believed the "application of
United States v. Santos has evolved and expanded," this Court later appointed counsel to represent

Mathison.

II.

WHETHER MATHISON'S 2241 HABEAS PETITION MUST BE FILED IN
COLORADO, DEPRIVING THIS COURT OF JURISDICTION?
Respondent contends this Court has no jurisdiction over Mathison's Section 2241 habeas
petition because it should have been filed in the District ofColorado where he is incarcerated and his
custodian is located. As the preceding discussion points out, Mathison promptly filed a 2241 habeas
petition in the District of Colorado where he is incarcerated and his custodian is located, but that
district court denied the petition after determining that Mathison needed to file a petition challenging
his conviction in the District of South Dakota.

Respondent's predecessor supported that

determination and did not set forth facts disputing that determination in his opposition to Mathison's

11

motion for release pending review. Respondent cites to United States v. Chappel, 208 F.3d 1069,
1070 (8th Cir. 2000), and Cox v. Federal Bureau 0/Prisons, 643 F.2d 534, 536 n. 3 (8th Cir. 1981),
as authority for his position that the Section 2241 petition must be filed in the district ofincarceration.
These cases, however, dealt with the execution of a prisoner's sentence, not the validity of his
conviction.
Respondent also relies upon Rums/eld v. Padilla, 542 U.S. 426,444 (2004), for his position
that jurisdiction for a habeas petition lies only in the district ofconfinement. In Rums/eld v. Padilla,
Padilla, a United States citizen, was brought to New York for detention in connection with a grand
jury investigation in the Southern District 0 fN ew York concerning the September 11, 2001 al Qaeda
terrorist attacks. After Padilla was designated by the President to be an "enemy combatant" he was
moved to a Navy brig in Charleston, South Carolina. Padilla's counsel filed in the Southern District
of New York a habeas petition under 28 U.S.C. § 2241, alleging that Padilla's military detention
violated the Constitution, and naming as respondents, the President, the Secretary of Defense, and
the brig's commander. The Supreme Court in determining whether the Southern District of New
York had jurisdiction addressed two questions: "First, who is the proper respondent to that petition?
and second, does the Southern District have jurisdiction over him or her?" 542 U.S. at 434.
Because 28 U.S.C. § 2242 9 and 28 U.S.c. § 2243 10 provide that the proper respondent in a
habeas petition is the person having custody of the person detained, the Supreme Court held that in
"core challenges," habeas challenges to present physical confinement, the default rule makes the
warden of the facility where the prisoner is being held, not the Attorney General or some other
remote supervisory official, the proper respondent. 542 U.S. at 435.

928 U.S.C. § 2242 provides in relevant part:
Application for a writ of habeas corpus shall be in writing signed and verified by
the person for whose relief it is intended or by someone acting in his behalf
It shall allege the facts concerning the applicant's commitment or detention, the
name of the person who has custody over him and by virtue ofwhat claim or
authority, if known.

10

28 U.S.c.§ 2243 provides in relevant part: ''The writ, or order to show cause shall be
directed to the person having custody of the person detained."
12

With regard to the question ofwhether the district court has jurisdiction over a respondent,
the Supreme Court in Rumsfeld v. Padilla examined the language in 28 U. S. C. § 2241 (a) stating that
writs ofhabeas corpus may be granted by district courts "within their respective jurisdictions." The
Supreme Court in Padilla relied upon its interpretation ofthis language in an earlier case, Braden v.

30th Judicial Circuit Court ofKentucky, 410 U.S. 484, 495 (1973), to require "nothing more than
that the court issuing the writ have jurisdiction over the custodian." Padilla, 542 U.S. at 42. The
Supreme Court observed that the ''traditional rule has always been that the Great Writ is 'issuable
only in the district ofconfinement. '" Id. (quoting Carbo v. United States, 364 U.S. 611, 617 (1961)
(writ ofhabeas corpus ad prosequendum suffers no geographical limitations on its use). The Supreme
Court in Padilla also relied on the language of28 U.S.C. § 2241 that an application for habeas relief
to the Supreme Court or a circuit judge state the reasons for not petitioning ''the district court ofthe
district in which the applicant is held." 542 U.S. at 442.
The Supreme Court in Padilla also noted that Congress has fashioned explicit exceptions to
the "district ofconfinement" rule when exceptions were to exist. Interestingly, the Court specifically
noted that ''until Congress directed federal criminal prisoners to file certain postconviction petitions
in the sentencing courts by adding § 2255 to the habeas statute, federal prisoners could litigate such
collateral attacks only in the district of confinement." 542 U.S. at 443. None of the cases cited by
the Padilla decision in support of the "district of confinement" rule involved cases fulling under the
savings cIause in 28 U.S.C. § 2255(e). This Court will assume for purposes ofthis opinion, however,
that the "district of confinement" rule generally applies to savings clause cases brought pursuant to
28 U.S.C. § 2241.11

II All

but two ofthe cases Mathison cites as support for his position that because his
challenge concerns the validity of his conviction and sentence, not the execution of his
sentence, this Court does not need to have jurisdiction over his custodian, were decided before
Padilla. One case decided after Padilla involved the respondent requesting a transfer to the
district where the petitioner was tried, convicted and sentenced. In addition, the petitioner had
been released from BOP custody at the time the magistrate considered his § 2241 petition. See
Key v. O'Brien, 2011 WL 3648238 (N.D.W.Va. July 19, 2011). In the other case, the petition
was filed in the district of confinement, and the district court transferred it to the sentencing court.
See Hill v. Daniels, 2005 WL 2249858 (D.Or. September 14,2005).

13

The majority opinion in Padilla notes: "The word 'jurisdiction,' of course, is capable of
different interpretations. We use it in the sense that it is used in the habeas statute, 28 U.S.C.

§ 2241 (a), and not in the sense of subject-matter jurisdiction ofthe District Court." 542 U.S. at 434
n.7. Also, in a concurring opinion in Padilla, Justice Kennedy, joined by Justice O'Connor, stated
that "the proper location 0 f a habeas petition is best understood as a question 0 f personal jurisdiction
or venue." 542 U.S. at 451 (citing Moore v. Olson, 368 F.3d 757,759-760 (C.A.7th Cir. 2004)
(suggesting that the territorial-jurisdiction rule is a venue rule, and the immediate-custodian rule is
a personal-jurisdiction rule».

The

concurring opinion observed

that

"[b]ecause the

immediate-custodian and territorial-jurisdiction rules are like personal-jurisdiction or venue rules,
objections to the filing ofpetitions based on those grounds can be waived by the Government." The
concurring opinion further advised:
The precise question of how best to characterize the statutory direction respecting
where the action must be filed need not be resolved with finality in this case. Here
there has been no waiver by the Government; there is no established exception to the
immediate-custodian rule or to the rule that the action must be brought in the district
court with authority over the territory in question; and there is no need to consider
some further exception to protect the integrity ofthe writ or the rights of the person
detained.

Padilla, 542 U.S. at 453 (Kennedy, J., concurring).
The Eighth Circuit Court ofAppeals has held that the failure to file a § 2241 petition in the
district where a prisoner is confined or where the BOP has a central or regional office is a defect that
does not deprive the district court ofsubject matter jurisdiction. See Mathena v. United States, 577
F.3d 943, 946 n.3 (8th Cir. 2009). In the Mathena case the Eighth Circuit held that the government
waived any objection to the petitioner not bringing his § 2241 petition in the district of confinement
by not raising the issue. Id.
Mathison argues that in its brief the government only challenges this Court's subject matter
jurisdiction over this petition, and, in fact, denies that it addresses the issue of venue. As such,
Mathison argues, Warden Berkebile and the United States should be deemed to have waived any
challenge to venue or personal jurisdiction in this case. Doc. 16, p. 6. Although the government's
brief does not articulate the distinction between subject matter jurisdiction and in personam

14

jurisdiction,12 considering the motion and briefs as a whole, the Court does not find that the
Government waived any habeas or in personam jurisdiction claim. The Court does conclude,
however, that under the facts of this case, the Respondent is estopped from challenging personal
jurisdiction.
The Supreme Court has recognized ''the requirement of personal jurisdiction may be
intentionally waived, or for various reasons a defendant may be estopped from raising the issue."
Insurance Corp. ofIreland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 704 (1982).

''The doctrine ofjudicial estoppel prohibits a party from taking inconsistent positions in the same or
related litigation." Hossaini v. Western. Mo. Med. Ctr., 140 F.3d 1140, 1142 (8th Cir.1998). Judicial
estoppel may in certain instances be applied sua sponte. See. e.g.. lntellivision v. Microsoft Corp., 784
F.Supp.2d 356,363 n. 3 (S.D.N.Y.,2011) ;Grigson v. CreativeArtistsAgency, L.L.c., 210 F.3d 524,
530 (5th Cir.2000). Judicial estoppel applies to one in privity to a party who has asserted a fact or
claim relied on or that a court adjudicated. See Maitland v. University ofMinnesota, 43 F.3d 357,
364 (8th Cir.1994).
Although the contours ofjudicial estoppel are not sharply defined,13 in determining whether
to apply judicial estoppel, a court must generally consider the following factors: (1) whether a party's
later position is clearly inconsistent with its earlier position, (2) whether the party has succeeded in
persuading a court to accept that party's earlier position, so that judicial acceptance ofan inconsistent
position in a later proceeding would create the perception that either the first or the second court was
misled, and (3) whether the party seeking to assert an inconsistent position would derive an unfair
advantage or impose an unfair detriment on the opposing party ifnot estopped. SchafJart v. ONEOK.

'2The Eighth Circuit in Mathena v. United States, 577 F.3d 943, 946 n.3 (8th Cir. 2009),
cited to Lee v. United States, 501 F.2d 494, 500-01 (8th Cir. 1974), for the proposition that
considering the appropriate district for a § 2241 petition is a question ofin personam jurisdiction.
13See. e.g.• Milton H. Greene Archives. Inc. v. Marilyn Monroe, 692 F.3d 983, 993
(9th Cir. 2012) (,'The Supreme Court has provided little guidance on the contours ofjudicial
estoppel. It has acknowledged that circumstances where the doctrine may apply 'are probably not
reducible to any general formulation."'); Perry v. Blum, 629 F.3d 1,8 (1st Cir. 2010) (''The
contours ofjudicial estoppel are hazy.")

15

Inc., 686 F.3d 461, 469 (8th Cir. 2012); Gray v. City o/Valley Park, Mo., 567 F.3d 976,981 (8th
Cir.2009).
Respondent's position that Mathison must bring this action in a § 2241 action in district court
in Colorado is clearly inconsistent with the position taken by his predecessor in the Tenth Circuit that
Mathison's Santos claim must be ''brought pursuant to § 2255 in the district in which the conviction
and sentence were imposed." Attachment 2. Respondent's predecessor was successful in persuading
the Tenth Circuit that Mathison's challenge to his federal conviction should be raised in a motion to
vacate filed in the sentencing court. 14 Mathison v. Wiley, 318 Fed. Appx. 650, 2009 WL 784257
(10th Cir. March 26, 2009). Attachment 3. It appears that the current respondent would impose an
unfair detriment to now contend that Mathison should raise his claim under the Supreme Court's

Santos decision when Mathison did that very thing approximately two months after Santos was
decided, and the respondent consistently maintained he was incorrectly presenting a § 2241 claim in
the Colorado district court of confinement.
The Court makes a preliminary determination that judicial estoppel applies to the facts ofthis
case, but will allow the respondent to submit a brief addressing this issue. The Court believes that
it is particularly appropriate to apply judicial estoppel in this case since Mathison presents a case of
factual innocense to some of his money laundering convictions. The Supreme Court has observed
that actual innocence may serve as a gateway through which a petitioner may overcome procedural
and other bars to federal habeas review. See, e.g., McQuiggin v. Perkins, 133 S.Ct. 1924 (2013) (plea
of actual innocence can overcome habeas statute of limitations); In Re Davis, 130 S.Ct. 1 (2009)
(Serious constitutional issues arise from barring judicial review of certain actual innocense claims.);

Bousley v. United States, 523 U.S. 614, 622 (1998) (actual innocence may overcome a prisoner's
failure to raise a constitutional objection on direct review). In applying judicial estoppel in this case,
this Court would be recognizing its obligation "to balance the societal interests in finality, comity, and
conservation of scarce judicial resources with the individual interest in justice that arises in the

14 The Tenth Circuit was not presented with and did not consider the relevant facts when it
concluded: "And this court agrees with the district court that Petitioner failed to establish that the
remedies available to him under § 2255 are inadequate or ineffective. See Caravalho v. Pugh, 177
F.3d 1177, 1178 (10th Cir. 1999) (,Courts have found a remedy under 28 U.S.C. § 2255 to be
inadequate or ineffective only in extremely limited circumstances. ')."

16

extraordinary case." Schlup v. Delo, 513 U.S. 298, 324 (1995).
Further, the application ofjudicial estoppel in this case would result in considering Mathison's
claims in a manner that is consistent with the practical considerations supporting the enactment of
Section 2255. 15 Those considerations were an acknowledgment that, unlike the district ofthe court
of confinement, the district of sentencing contains the witnesses, court documents, prosecutors and
defense attorneys crucial to a collateral review. The jury trial in this case, over which this Court
presided, commenced on May 20, 1997, and ended on June 5, 1997. The United States Attorney's
office for the District of South Dakota recently delivered six boxes of exhibits from the trial. In
addition, documents from the U.S. Probation Office concerning the sentencing of Mathison are
located within this district.
In a number of cases in which habeas actions under the savings clause have been transferred
to the district where the sentencing court is located, the courts have recognized that the sentencing
court is better equipped to consider the application for habeas relief. See In re Nwanze, 242 F.3d 521,
527 (3rd Cir. 2001) (''better for [petitioner] to obtain relief under Bailey from the sentencing court
rather than from the court in the district of confinement as we have some doubt as to whether the
latter court could resentence on the remaining counts," and "only the sentencing court can know what
its intentions would have been ifit had been sentencing on the remaining counts."); Short v. Schultz,

15Prior to the enactment of Section 2255 the District Courts in whose territorial
jurisdiction major federal penal institutions were located were required to handle a large number
ofhabeas actions "far from the scene of the facts, the homes ofthe witnesses and the records of
the sentencing court solely because of the fortuitous concentration of federal prisoners within the
district." United States v. Hayman, 342 U.S. 205, 214 (1952). The Judicial Conference of the
United States then created a committee in 1942 to address the problems created by the increased
habeas corpus applications, and recommended proposed bills which created a procedure whereby
a federal prisoner might collaterally attack his conviction in the sentencing court. Id. at 214-215.
A Statement on behalf of the Judicial Conference Committee on Habeas Corpus Procedure was
submitted to Congress stressing the practical difficulties encountered in habeas hearings held in
the district of confinement rather than in the sentencing court. Id. at 215-216. The remedy under
the proposed Section 2255 was to broadly cover all situation where a sentence is open to
collateral attack. Id. at 217. The Supreme Court has characterized Section 2255 as follows: ''The
very purpose of Section 2255 is to hold any required hearing in the sentencing court because of
the inconvenience oftransporting court officials and other necessary witnesses to the district of
confinement." Hayman, 342 U.S. at 220-21.
17

No. 08-186, 2008 WL 305594, at *3 (D.N.1. Jan. 28, 2008) (sentencing court would have "superior
familiarity with the underlying conviction and sentence"). Mathison's case falls under the savings
clause, and applying the equitable doctrine ofjudicial estoppel would accommodate the practical
considerations set forth in history ofthe enactment of28 V.S.C § 2255 and in the cases transferring
savings clause cases.

CONCLUSION

Mathison presents an actual innocence claim that can be brought under § 2241 through the
savings clause of § 2255( e). This Court has made a preliminary determination that based on the facts
ofthis case, Respondent is estopped from challenging in personam jurisdiction and demanding that
Mathison's Section 2241 claim be brought in the District ofColorado, the district ofhis confinement.
This Court has also observed that a number of Mathison's money laundering convictions involve
payment to his confederates and therefore involve viable Santos claims. The Court has determined
that it would resentence Mathison to less than it originally sentenced Mathison based on some ofhis
money laundering convictions being vacated. 16 The Court notes that Mathison's current projected
release date is December 2, 2014. Mathison argues that merger problems exist with several other of
his money-laundering convictions which involve payments to alleged victims. Doc. 3, p.I7.
Respondent in this case has failed to specifically address the merits 0 f the Santos claim. Neither party
has addressed how vacating certain money laundering convictions would impact Mathison's sentence
at a resentencing. Accordingly,

IT IS ORDERED:
1.

That the Respondent's Motion to Dismiss for Lack of Jurisdiction (Doc. 6)
is denied without prejudice, and Respondent is allowed to brief the issue of
judicial estoppel by December 31,2013;

16If sentenced under grouping with current guidelines, the guideline range appears to be
168-210 months. Typically, resentencing applies current guidelines but this Court has not found a
similar collateral review guidelines application.
18

2.

That the Motion for Bail (Doc. 4) is held in abeyance pending the Court's
consideration of Respondent's submission regarding estoppel;

3.

That the Motion for Leave to Proceed in/onna pauperis (Doc. 12) is granted;

4.

That on or before January 21,2014, unless the Court directs otherwise, the
parties shall submit simultaneous briefs on which of Mathison's convictions
should be vacated, and what impact the same should have on the calculation
of a sentence at a resentencing.

Dated this 20th day of December, 2013.

BY THE COURT:

a."'fJLu.l~ScM-.

rence L. Piersol
United States District Judge
ATTEST:
JOSEPH HAAS, CLERK
BY:

~ ~{N-Deputy,

19