Gray v. Warden

OCR transcription for search; preserved printed pages are authoritative

AUTHE

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page1of15

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF PENNSYLVANIA

NORMAN GRAY,
Petitioner : CIVIL ACTION NO. 3:26-1732

Vv. | ; (JUDGE MANNION)
WARDEN, FCI ALLENWOOD
LOW,
Respondent
MEMORANDUM

Currently before the Court is Norman Gray (“Gray")’s petition for a writ
of habeas corpus under 28 U.S.C. §2241. For the reasons stated below, the
Court will dismiss Gray's petition without prejudice due to his failure to
exhaust his administrative remedies.

I. BACKGROUND

A. Gray’s Underlying Federal Criminal Proceedings

On March 3, 2025, Gray was sentenced to one hundred and twenty
months of federal confinement, to be followed by three years of supervised
release, after a jury sitting in the United States District Court for the Southern
District of New York (“SDNY”) found him guilty of wire fraud (18 U.S.C.

§1343) on March 29, 2024. See United States v. Gray, No. 21-cr-713

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 2of15

(S.D.N.Y.) (‘Gray’), ECF Nos. 139, 213, 217.' Gray timely filed an appeal
from his criminal judgment to the Second Circuit Court of Appeals, see id.,
ECF No. 214), which is still pending before the Second Circuit. See Docket,
United Stafes v. Gray, No. 25-538 (2d Cir.).

On June 4, 2025, the SDNY issued a restitution order totaling
$1,533,675. See Gray, ECF No. 227. On October 2, 2025, the SDNY issued
an Order directing the Clerk of Court to transfer or otherwise apply $50,000
deposited in the SDNY’s registry to secure Gray’s appearance bond towards
satisfying his outstanding restitution obligation. See id., ECF No. 237. Gray
moved for reconsideration of this Order, which the SDNY denied as frivolous
on October 27, 2025. See id., ECF Nos. 238, 239. Gray also appealed from
the Order denying his motion for reconsideration, see id., ECF No. 240, and
this appeal remains pending before the Second Circuit. See Docket, United

States v. Gray, No. 25-2881 (2d Cir.).

' The Court takes judicial notice of the docket entries in Gray's
underlying criminal case and any related appellate proceedings. See Orabi
v. Att’y Gen. of the U.S., 738 F.3d 535, 537 n.1 (3d Cir. 2014) (unpublished)
(“We may take judicial notice of the contents of another Court's docket.”).
Additionally, the Court notes that even though the SDNY did not enter Gray's
criminal judgment until March 3, 2025, Gray’s sentencing hearing occurred
on February 20, 2025. See Gray, ECF No. 213 at 1 (identifying date sentence
imposed).

-2-

f

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 3of15

On January 23, 2026, Gray filed a pro se “Motion for Appointment of
New Counsel and Time to Reconsider Restitution,” see Gray, ECF No. 2414,
which the SDNY denied a week later. See io., ECF No. 242. Gray appealed
from this denial to the Second Circuit, see id., ECF No. 243, and this third
appeal remains pending with the Second Circuit. See United States v. Gray,
No. 26-383 (2d Cir.).

On June 23, 2026, Gray filed a motion for return of property, which the
SDNY denied on July 7, 2026. See Gray, ECF Nos. 256, 259. Gray has also
appealed this determination to the Second Circuit, see id., ECF No. 260, and
this fourth appeal remains pending with the Second Circuit. See United
| States v. Gray, No. 26-2056 (2d Cir.). |

B. Gray’s Section 2241 Habeas Petition

Gray, who is currently incarcerated at Federal Correctional Institution
Allenwood Low (“FCI Allenwood Low’) and has an anticipated release date
of December 8, 2032, according to the Federal Bureau of Prisons (“BOP”)’s
Inmate Locator (httos://Awww.bop.gov/mobile/find_inmate/index.jsp),
commenced the instant action by filing his Section 2241 petition, which the
Clerk of Court docketed on June 22, 2026. (Doc. 1.) Gray did not remit the
filing fee or apply for leave to proceed in forma pauperis when he filed his

petition; as such, an Administrative Order issued requiring him to either pay

-3-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 4of15

the fee or file an application for leave to proceed in forma pauperis. (Doc. 3.)
On July 7, 2026, Gray timely remitted the filing fee. (Doc. 4.)

In his Section 2241 habeas petition, Gray asserts that the Federal
Bureau of Prisons (“BOP”) is unlawfully assessing him restitution payments
pursuant to the Inmate Financial Responsibility Program ("IFRP”). See (Doc.
1 at 1-2). He alleges that he earns approximately $20 per month due to his
“chapel job,” and he is otherwise dependent on his family for other financial
commitments while incarcerated. See (id. at 1). Yet, Gray's case manager at
FCI Allenwood Low “informed him that because of the small stipend support
from his family, [he] is required to pay” through the IFRP. (/d.) Gray asserts
that he had to pay $20 per quarter at first, but then the case manager
increased the amount to $200 per month. See (id.). The case manager also
“asked Gray to sign an acceptance” and told him that if he did not sign it, “it
would be documented as a “Refusal [sic].” (/d.) Gray apparently signed the
agreement but “with a notation that he is not refusing to make payments . .
.[;] rather[,] he is unable to afford the payment.” (/d.); see also (Doc. 1-2 at
2).

For the first IFRP collection in May 2026, the BOP took $27.97 from
Gray’s account, which was all his available funds at the time. See (Doc. 1 at

2). Then, on June 9, 2026, Gray was “summoned” to see the case manager,

-4-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page5of15

“who advised him that she was reducing the amount to $150[,] and if he did
not have funds to pay, he would be ‘put into refusal’ where he would lose all
his earned [First Step Act (“FSA’)] benefits.” (/d.) Gray asserts that he again
told her that he was unable to pay the required amount, and the case
manager “simply snickered” in response. (/d.)

Gray appears to argue that the case manager's actions regarding his
IFRP payments are improper in four respects. First, he asserts that the BOP
should not have initiated an IFRP because the SDNY’s restitution Order is
“not final” insofar as he is still challenging it on appeal. See (id.). Second, he
contends that the BOP lacks authority to withhold payments because the
SDNY did not establish a payment schedule during his incarceration as part
of his criminal judgment. See (id.). He argues that the Mandatory Victims
Restitution Act, 18 U.S.C. §3663A ("MVRA”) does not allow a sentencing
court to “simply order immediate restitution [and] delegate[] the details of
‘how’ or ‘how much’ is withheld to the [BOP] without consider[ing] the
[defendant's] ability to pay.” (/d.) According to Gray, the sentencing court
must set a specific schedule for restitution payments in the criminal judgment
if the court intends to require a defendant to make restitution payments
during their incarceration. See (id.). Because that did not happen here, Gray

believes that the BOP’s actions regarding his IFRP are unlawful. See (id.).

_5-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 6of15

Third, Gray contends that the BOP cannot designate him as refusing
to participate in the IFRP and “punish{[]}" him accordingly because his inability
to pay does not constitute a refusal. (/d.) Gray indicates that “economic
impossibility is not the same as willful refusal; fiduciary or penal
consequences (like being placed in ‘refusal’) cannot be enforced if one
shows financial inability.” (/d.) Fourth, and finally, Gray argues that the BOP
has violated his due process rights by “withhold[ing] a large sum [of money]
without [providing him with an] opportunity to contest [his] ability to pay.” (/d.)
Gray believes that “one has a liberty interest in certain prison privileges,” so
any placement in “refusal status” that “triggers [the] loss of guaranteed
privileges” implicates a person's procedural due process rights. (/d.)

For relief, Gray seeks and Order (1) declaring that “the BOP/Warden
lacks the authority to withhold $150/month absent a valid schedule in the
sentencing judgment considering [his] ability to pay’; (2) stopping the
“BOP/Warden [from] categorizing [him] as [a] ‘refusal’ or penalizing [him] for
his inability to pay”; and (3) directing the BOP to “modif[y his] withholding to
the original $20/quarter.” (/d.) He also asks the Court to “forgive any errors
in {]his pro se [mJotion.” (/d.)

On July 13, 2026, the Court issued an Order which, inter alia, directed

Respondent to file a response to Gray's Section 2241 habeas petition. (Doc.

-6-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 7 of 15

5.) Respondent timely filed a response to Gray’s petition on August 3, 2026.
(Doc. 7.) In this response, Respondent argues that the Court should (1)
dismiss Gray's petition because he failed to exhaust his administrative
remedies or (2) deny the petition because the BOP is properly assessing
Gray under the IFRP. See (Doc. 7 at 7~—15).

Gray filed a reply brief in further support of his habeas petition, which
the Clerk of Court docketed on August 24, 2026. (Doc. 8.) In his reply, Gray
argues that, infer alia, he did not need to fully exhaust his claims in this case
because he would suffer “imminent harm” insofar as his misclassification as
a IFRP refusal causes him to lose FSA privileges such as spending limits
and free phone minutes, which prejudices him in “fighting his six . . . civil
[cases].” (/d. at 1). He also asserts that he will not be able to afford copy
cards or use the Trulinks email application to type and prepare legal
documents. See (id.). He further contends that the BOP’s decision to
designate him as “refusing to pay” under the IFRP prejudices his ability to

litigate his six civil actions. See (id.).

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 8of15

HW. LEGAL STANDARD

Under Section 2241, habeas relief may be extended to a federal
prisoner only when they are “in custody in violation of the Constitution or laws
or treaties of the United States.” 28 U.S.C. §2241(c)(3). Pursuant to Rule 4
of the Rules Governing Section 2254 Cases in the United States District
Courts, applicable to Section 2241 petitions through Rule 1(b), this Court has
the authority to dismiss a habeas petition if it “plainly appears from the
petition and any attached exhibits that the petitioner is not entitled to relief.”
R. 4, 28 U.S.C. foll. §2254; see R. 1(b), 28 U.S.C. foll. §2254 ("The district
court may apply any or all of these rules to a habeas corpus petition not
[involving a petition under 28 U.S.C. §2254].”); see also Heath v. Bell, 448
F. Supp. 416, 417 (M.D. Pa. 1977) (noting that Rule 1(b) of the Rules
Governing Section 2254 Habeas Petitions in the United States District
Courts renders Rule 4 applicable to Section 2241 habeas petitions). Thus, a
district court is “authorized to dismiss summarily any habeas petition that
appears legally insufficient on its face.” McFarland v. Scott, 512 U.S. 849,
856 (1994) (citing R. 4, 28 U.S.C. foll. §2254).

Section 2241 confers federal jurisdiction over a habeas petition that
has been filed by a federal inmate challenging “not the validity but the

execution of [their] sentence.” Cardona v. Bledsoe, 681 F.3d 533, 535 (3d

-8-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 9of15

Cir. 2012) (citations and footnote omitted); Woodall v. Fed. Bureau of
Prisons, 432 F.3d 235, 241 (3d Cir. 2005) (stating that Section 2241 “allows
a federal prisoner to challenge the ‘execution’ of his sentence in habeas’).
While “the precise meaning of ‘execution of the sentence’ is hazyj,]’ the
phrase has been interpreted as to “put into effect” or “carry out.” Woodall,
432 F.3d at 242, 243 (citation omitted). As a result, a federal inmate may
challenge conduct undertaken by the BOP that affects the duration of the
inmate’s custody. See, e.g., Barden v. Keohane, 921 F.2d 476, 478-79 (3d
Cir. 1990) (finding that a federal inmate’s Section 2241 petition is actionable
where the inmate attacks the term of their custody by challenging the manner
in which the BOP is computing their federal sentence); United States v. Vidal,
647 F. App’x 59, 60 (3d Cir. 2016) (unpublished) (“Because [the federal
inmate's] claim challenges the BOP’s calculation of sentence credits, it is
appropriately addressed in a petition for a writ of habeas corpus pursuant to
[Section] 2241” (citation omitted)).

Unlike with Section 2254 habeas petitions and Section 2255 mations,
there is no explicit statutory exhaustion requirement for Section 2241 habeas
petitions. See Callwood v. Enos, 230 F.3d 627, 634 (3d Cir. 2000) ("[T]here
is no statutory exhaustion requirement attached to §2241[.]"). Nevertheless,

the Third Circuit Court of Appeals has “consistently applied an exhaustion

_9-

Case 3:26-cv-01732-MEM-SH Document9 _ Filed 10/13/26 Page 10 of 15

requirement to claims brought under §2241.” /d. (citations omitted).
Exhaustion “allow[s] the appropriate agency to develop a factual record and
apply its expertise[,] .. . conserves judicial resources[,] and. . . provide[s]
agencies the opportunity to correct their own errors [which] fosters
administrative autonomy.” Moscato v. Fed. Bureau of Prisons, 98 F.3d 757,
761-62 (3d Cir. 1996) (citations omitted).

Exhaustion is the rule in most cases, and failure to exhaust will
generally preclude federal habeas review. See Eiland v. Warden Fort Dix
FCI, 634 F. App’x 87, 89 (3d Cir. 2015) (unpublished) (explaining that
“exhaustion is a precondition to bringing suit” and summarily affirming district
court’s dismissal of Section 2241 petition due to petitioner's failure to
exhaust). Only in rare circumstances is exhaustion of administrative
remedies not required. For exampie, exhaustion is unnecessary if “the issue
presented invoive[s] only statutory construction.” Vasquez v. Strada, 684
F.3d 431, 433-34 (3d Cir. 2012) (citing Bradshaw v. Carlson, 682 F.2d 1050,
1052 (3d Cir. 1981)). Similarly, exhaustion is not required “if an attempt to
obtain relief would be futile or where the purposes of exhaustion would not
be served.” Cerverizzo v. Yost, 380 F. App’x 115, 116 (3d Cir. 2010)
(unpublished); see also Duckworth v. Serrano, 454 U.S. 1, 3 (1981)

(explaining that “[a]n exception is made [to the exhaustion requirement] only

-10-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 11 of 15

if there is no opportunity to obtain redress in state court or if the corrective
process is so clearly deficient as to render futile any effort to obtain relief’).
Concerning exhaustion within the BOP, it has an Administrative
Remedy Program through which federal prisoners can request review of
nearly any aspect of their imprisonment. See 28 C.F.R. §542.10(a) (“The
purpose of the Administrative Remedy Program is to allow an inmate to seek
formal review of an issue relating to any aspect of his/her own
confinement.”). Specifically, the BOP has a four (4)-step administrative
process through which an inmate can address issues concerning the
conditions of their confinement. See id. §542.13(a)-15(a). Except in
circumstances inapplicable here, an inmate must first informally present the
complaint to staff, who must attempt to informally resolve the matter. See id.
§542.13(a) (“Except as provided in §542.13(b), an inmate shall first present
an issue of concern informally to staff, and staff shall attempt to informally
resolve the issue before an inmate submits a Request for Administrative
Remedy.”). If the informal resolution is unsuccessful, then the inmate must
execute the appropriate form (BP—9) to bring the matter to the attention of
the Warden, within twenty (20) calendar days of the date of the incident. See
id. §542.14(a) (“The deadline for completion of informal resolution and

submission of a formal written Administrative Remedy Request, on the

-41-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 12 of 15

appropriate form (BP—9), is 20 calendar days following the date on which the
basis for the Request occurred.”). If the inmate is dissatisfied with the
Warden's response, they may then appeal to the Regional Director within
twenty (20) calendar days. See id. §542.15(a) ("An inmate who is not
satisfied with the Warden’s response may submit an Appeal on the
appropriate form (BP—10) to the appropriate Regional Director within 20
calendar days of the date the Warden signed the response.”). The inmate
may then, if dissatisfied with the Regional Director's response, appeal to the
General Counsel at the BOP’s Ceniral Office within thirty (30) calendar days.
See id. (“An inmate who is not satisfied with the Regional Director’s response
may submit an Appeal on the appropriate form (BP—11) to the General
Counsel within 30 calendar days of the date the Regional Director signed the
response.”). This is the final administrative appeal level in the BOP, and no
administrative appeal is considered to have been fully exhausted until
considered by the BOP’s General Counsel. See id. (‘Appeal to the General
Counsel is the final administrative appeal.”); see also Redmond v. Dortch,
823 F. App’x 266, 267 (Sth Cir. 2020) (unpublished) (“Redmond did not fully
exhaust his remedies because he never completed the fourth and final step

of appeal to the Office of General Counsel.”).

-12-

Case 3:26-cv-01732-MEM-SH Document9_ Filed 10/13/26 Page 13 of 15

lll. DISCUSSION

The Court will dismiss Gray’s habeas petition without prejudice due to
his failure to exhaust his administrative remedies. Respondent has produced
evidence showing that Gray failed to exhaust his administrative remedies
prior to filing his habeas petition, see (Docs. 7-2-7-6), and Gray concedes
that he failed to exhaust his administrative remedies. See (Doc. 8 at 1).
However, he argues that the Court should excuse his failure to exhaust
because he will suffer “imminent harm” without habeas relief. See (id.).

Habeas petitioners such as Gray may seek to have administrative
exhaustion excused “if the administrative procedure is clearly shown to be
inadequate to prevent irreparable harm.” Lyons v. U.S. Marshals, 840 F.2d
202, 205 (3d Cir. 1988).2 However, Gray fails to make such a showing here.
He has not clearly demonstrated that the BOP’s administrative procedure is
inadequate to prevent irreparable harm. Moreover, while he claims that he is

suffering from, and will suffer from, certain harm, such as certain spending

2 Other than “imminent harm,” Gray does not identify any excuse for
his failure to exhaust. See (Doc. 8 at 1). As such, the Court does not address
any other possible excuse in this Memorandum. See Estrella v. Warden FCI
Lewisburg, No. 26-cv-61, 2026 WL 800954, at *2 (M.D. Pa. Mar. 23, 2026)
(“Although the respondent has the initial burden to establish failure to
exhaust administrative remedies, once the respondent has done so the
petitioner generally must demonstrate an exception or excuse that would
allow [them] to proceed without exhausting administrative remedies.”
(citations omitted)).

-13-

Case 3:26-cv-01732-MEM-SH Document9 Filed 10/13/26 Page 14 of 15

limits, the loss of free phone minutes, an inability to afford copy cards, and
an inability to use the email application on Trulinks to prepare legal
documents, he fails to show that such harm is “irreparable.” See /rreparable,
Black’s Law Dictionary (12th ed. 2024) (defining “irreparable” as “[iJncapable
of being rectified, restored, remedied, cured, regained, or repaired: that
cannot be made right or good”).

The Court notes that Gray contends that his IFRP refusal status, and
the “subsequent loss of FSA privileges, . . . prejudices [him] in fighting his six
civil [cases].” (Doc. 8 at 1.) He also asserts that “[t]he Court’s attention to this
matter is dire to [his] ability to conduct a reasonable defense in his pending
civil cases with strict date requirements.” (/d.) However, he does not
articulate the manner he is prejudiced in litigating his civil cases in anyway
whatsoever. His refusal status certainly has not prejudiced him in this case
or in his other two civil cases which have been assigned to the undersigned.
See Gray v. Warden FCI Allenwood Low, No. 26-cv-2603 (M.D..Pa.); Gray
v. Warden FCI Allenwood Low, No. 26-cv-1432 (M.D. Pa.). He also does not
articulate any facts that he would be unable to seek an extension of time
should he have any issues meeting deadlines in his other civil cases. Overall,
it is improper for Gray to fail to exhaust his administrative remedies due to

purported imminent harm, as most habeas petitioners argue that they are

-14-

Case 3:26-cv-01732-MEM-SH Document9_ Filed 10/13/26 Page 15 of 15

experiencing some type of present harm due to some aspect of their
continued incarceration, and federal courts still require exhaustion except in
“rare circumstances.” Mitchell v. Warden FPC Lewisburg, No. 26-cv-147,
2026 WL 2731263, at *1 (M.D. Pa. Sept. 16, 2026). Accordingly, Gray has
not shown that the Court should excuse his failure to exhaust his habeas
claims in this case and will dismiss his petition without prejudice to him filing
a new petition once he fully exhausts his administrative remedies with the
BOP.
IV. CONCLUSION

For the reasons stated above, the Court will dismiss Gray’s Section

2241 habeas petition without prejudice due to his failure to exhaust. An

ALAGHY E. MANNION
United States District Judge

appropriate Order follows.

DATE: October 12, 2026

26-1732-01

-15-