Abu-Shawish v. United States

• Decision Date: 31 July 2018
• Docket Number: No. 17-1283,17-1283
• Citation: 898 F.3d 726
• Parties: Mhammad ABU-SHAWISH, Petitioner-Appellant, v. UNITED STATES of America, Respondent-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

898 F.3d 726

Mhammad ABU-SHAWISH, Petitioner-Appellant,

v.UNITED STATES of America, Respondent-Appellee.

No. 17-1283

United States Court of Appeals, Seventh Circuit.

Argued April 5, 2018

Decided July 31, 2018

Florina Yezril, Attorney, Mayer Brown LLP, New York, NY, for Petitioner-Appellant.

Jonathan H. Koenig, Attorney, Karine Moreno-Taxman, Attorney, Office of the United States Attorney, Milwaukee, WI, for Respondent-Appellee.

Before Kanne, Rovner, and Hamilton, Circuit Judges.

Hamilton, Circuit Judge.

Petitioner-appellant Mhammad Abu-Shawish was tried and convicted on a federal fraud charge, but that conviction was reversed after he served the entire prison sentence. Abu-Shawish was acquitted in a second trial. He now seeks damages under 28 U.S.C. § 1495 and § 2513 for unjust conviction and imprisonment. Abu-Shawish petitioned for a certificate of innocence—a prerequisite to a damages claim against the United States under those statutes. In this appeal, the government is in the unusual position of defending a dismissal it never requested. Without any response from the government, the district court dismissed the petition, reasoning that Abu-Shawish failed to provide evidence of his actual innocence. United States v. Abu-Shawish , 228 F.Supp.3d 878, 883–84 (E.D. Wis. 2017).

We vacate the dismissal and remand for further proceedings. The district court applied a standard that is too rigorous for the pleading stage of what is, in essence, a new civil case embedded within a closed criminal case. In the end, the question in this proceeding is whether Abu-Shawish can show by a preponderance of the evidence that he was in fact not guilty of a crime, not whether the trial evidence would have allowed a conviction. This is not to say that Abu-Shawish is entitled to relief, but he must be given a fair opportunity to show that he is entitled to damages under the governing statutes.

I. Factual and Procedural Background

A. Underlying Facts

Abu-Shawish was the founder and executive director of a Milwaukee-based non-profit organization. United States v. Abu-Shawish , 507 F.3d 550, 552 (7th Cir. 2007). On behalf of that non-profit, Abu-Shawish sought and received a grant from the City of Milwaukee to create a plan for revitalizing a street in Milwaukee. The problem was that the development plan from Abu-Shawish’s non-profit was "essentially identical" to a plan submitted by someone else and sponsored by a separate group. Id. at 553. The funds for the grant came from the United States Department of Housing and Urban Development, id. at 552, which explains why a local grant proposal ultimately piqued the interest of federal prosecutors.

B. First Trial

On the theory that Abu-Shawish took the government’s money but gave it nothing it had not already paid for, the government charged him with federal program fraud under 18 U.S.C. § 666(a)(1)(A). A jury convicted Abu-Shawish in 2005. The district court sentenced Abu-Shawish to three years in prison and ordered him to pay $75,000 in restitution to the City of Milwaukee, $1,000 in fines, and a $100 assessment. Abu-Shawish served the full sentence.

We vacated Abu-Shawish’s conviction. Abu-Shawish , 507 F.3d at 558. We held that the government charged Abu-Shawish with the wrong crime because the federal program fraud statute requires that the defendant be an agent of the defrauded organization. Id. at 556. Because Abu-Shawish was not an agent of the City of Milwaukee, and because the indictment did not indicate that Abu-Shawish defrauded his own non-profit, he could not be charged under the federal program fraud statute. See id. at 558. Our opinion went on to say that "the indictment properly alleged and the evidence was sufficient to show that Abu-Shawish defrauded the City of Milwaukee." Id. We noted that the government likely could have charged Abu-Shawish with mail or wire fraud. Id.

C. Second Trial

On remand, the district court dismissed the indictment for federal program fraud. A grand jury indicted Abu-Shawish again—this time as a principal under 18 U.S.C. § 2 on charges of mail fraud ( 18 U.S.C. § 1341 ) and transporting, in foreign commerce, funds obtained by fraud ( 18 U.S.C. § 2314 ). The case went to trial in 2008. This time the jury found Abu-Shawish not guilty.

D. Certificate of Innocence Filings

In 2014, Abu-Shawish filed a complaint against the United States in the Court of Federal Claims pursuant to 28 U.S.C. § 1495 and § 2513 seeking damages for unjust conviction and imprisonment. Abu-Shawish v. United States , 120 Fed.Cl. 812, 812 (2015). Abu-Shawish filed that complaint after unsuccessfully suing the government and individual defendants for malicious prosecution and other torts. See Abu-Shawish v. United States , 546 F. App'x 576 (7th Cir. 2013). The Court of Federal Claims dismissed without prejudice for lack of jurisdiction because Abu-Shawish had not yet obtained a certificate of innocence, which § 2513 requires him to seek from the court where he was convicted. Abu-Shawish , 120 Fed.Cl. at 812, 814.

In November 2015, Abu-Shawish went back to the district court in Wisconsin and filed a pro se petition for a certificate of innocence.¹ The petition alleges that this court vacated the conviction on the federal program fraud charge, that the jury acquitted Abu-Shawish on the charges of mail fraud and transporting stolen funds in foreign commerce in the second trial, and that this acquittal proves Abu-Shawish "was and still is innocent of the charged offenses and of any fraud." After more than three months with no docket activity, Abu-Shawish filed a motion to expedite a decision on his petition. The government never responded to the original petition or to the motion to expedite. The district court dismissed the petition in January 2017. Abu-Shawish appealed, and we recruited counsel, who have been of great assistance to the court and their client.

II. Analysis

It is difficult to prove actual innocence, and proceedings like this one are rare. See Pulungan v. United States , 722 F.3d 983 (7th Cir. 2013) (reversing grant of certificate; reversal of conviction was not sufficient to show actual innocence); Engel v. Buchan , 710 F.3d 698, 707 (7th Cir. 2013) (federal unjust conviction statutes do not apply to convictions under state law); Betts v. United States , 10 F.3d 1278 (7th Cir. 1993) (ordering grant of petition). Those cases and decisions by other courts explain that the federal statutes set a high bar for obtaining a certificate of innocence. Because of the scant precedent on this issue, we begin with a review of the statutes and their history.

A. Current Statutes

Read together, two statutes give people who have been unjustly convicted and imprisoned for a federal crime a damages remedy against the United States. The first gives the Court of Federal Claims jurisdiction over "any claim for damages by any person unjustly convicted of an offense against the United States and imprisoned." 28 U.S.C. § 1495. The second establishes what a petitioner must prove and how and where a petitioner must prove it to establish the damages claim. 28 U.S.C. § 2513.² Section 2513(a) includes two paragraphs that impose distinct requirements for what a petitioner must allege and prove:

First, the petitioner must establish that the record of the court setting aside or reversing his conviction demonstrates that the court did so on the ground that he is not guilty of the offense for which he was convicted. Second, the petitioner must prove that he did not commit any of the acts charged, or that those acts or related acts constituted no crime against the United States, or any State, Territory or the District of Columbia. Third, the petitioner must demonstrate that he did not by misconduct or neglect cause or bring about his own prosecution.

United States v. Mills , 773 F.3d 563, 566 (4th Cir. 2014), citing United States v. Graham , 608 F.3d 164 (4th Cir. 2010).

The petitioner proves those requirements to the Court of Claims by submitting a certificate of innocence from the court of conviction. See § 2513(b). To obtain that certificate in the court of conviction, the petitioner bears the "burdens of production and persuasion." Pulungan , 722 F.3d at 986 ; see also Graham , 608 F.3d at 172 (noting that § 2513"imposes a rigorous burden"). Section 1495 waives the government’s sovereign immunity, e.g., Betts , 10 F.3d at 1282, so courts construe § 2513 strictly, e.g., Graham , 608 F.3d at 172 (collecting cases). The few opinions on this subject highlight the result of that strict construction: out of twelve published appellate opinions with material treatment of § 2513, our opinion in Betts is the only one to reverse and remand with instructions to grant the petition.³

B. Statutory History

The story that led to these federal unjust conviction statutes supports this stringent standard. The story begins with front-page news in 1911: a wrongful conviction following a labor riot in one of Andrew Carnegie’s steel mills. The cast of characters includes not just Andrew Carnegie but also Charles Schwab, Dean Wigmore, and then-Professor Felix Frankfurter. Our discussion draws from the comprehensive treatment of the legislative history in United States v. Keegan , 71 F.Supp. 623 (S.D.N.Y. 1947).

Andrew Carnegie made the front page of the New York Times for doing what the Pennsylvania legislature refused to do. Carnegie Pensions Toth . Man Who Served Twenty Years for Crime He Did Not Commit , N.Y. Times, Aug. 2, 1911, at 1. The legislature refused to compensate Andy Toth, a former steel-worker in one of Carnegie’s mills who was released from prison after serving twenty years of a life sentence for a murder he did not commit. Editorial, False Imprisonment , 17 Va. L. Reg. 406 (1911); Edwin M. Borchard, Convicting the Innocent 286 (1932). Carnegie arranged to pay Toth $40 a month for the rest of his life. Borchard, supra , at 291.

Toth was one of three defendants convicted of murder for the beating of a furnace boss during a...