United States Court of Appeals 

For the Seventh Circuit 

Chicago, Illinois 60604 

Submitted November 10, 2020*

Decided November 19, 2020 

Before 

DIANE S. SYKES, Chief Judge 

JOEL M. FLAUM, Circuit Judge 

MICHAEL B. BRENNAN, Circuit Judge

No. 20-1635 

MICHAEL T. HUGHES, 

Plaintiff-Appellant, 

v. 

KIM ANDERSON, et al., 

 Defendants-Appellees.

 Appeal from the United States District 

Court for the Northern District of Illinois, 

Eastern Division. 

No. 18 C 6139 

Virginia M. Kendall, 

Judge. 

O R D E R 

Michael Hughes, a pretrial detainee at the Cook County Jail, sued jail officials for 

deliberate indifference and proceeded in forma pauperis. See 28 U.S.C. § 1915(a). 

Defendants in another of Hughes’s suits (he had at least eight pending) moved to 

dismiss, arguing that he was depositing his money into other inmates’ accounts to 

avoid paying the filing fees. They relied on recordings of phone calls with his brother 

where Hughes stated that “this is the way to get around [the fees].” The district court 

agreed and dismissed Hughes’s suits with prejudice, finding a fraud on the court. 

*

 We have agreed to decide this case without oral argument because the briefs 

and record adequately present the facts and legal arguments, and oral argument would 

not significantly aid the court. FED. R. APP. P. 34(a)(2)(C). 

NONPRECEDENTIAL DISPOSITION 

To be cited only in accordance with Fed. R. App. P. 32.1 
No. 20-1635 Page 2 

Because the judge properly considered the recorded jail calls as evidence and 

permissibly ruled that Hughes’s conduct was intentional and egregious, we affirm. 

Hughes sued jail officials in 2018 for ignoring his repeated complaints of rectal 

bleeding and pain, a condition that ultimately led to the removal of his colon. After the 

judge denied his first application to proceed without prepaying the filing fee (in it 

Hughes omitted $1,600 in gifts that he recently received), she granted his second 

application. The judge warned him, though, that she would “not tolerate false or 

misleading statements” in the future and that such conduct may result in sanctions, 

including dismissal of his suit. The judge reminded Hughes that because she had also 

granted him leave to proceed without prepaying fees in five other pending cases, 100% 

of the balance of his inmate trust fund account exceeding $10 (20% for each case) would 

be deducted until his filing fees were fully paid. See id. § 1915(b)(2); see also Bruce v. 

Samuels, 577 U.S. 82, 85 (2016). Hughes later asked the court for an accounting of his 

unpaid filing fees, revealing that he owed almost $4,000. 

In a separate suit where Hughes alleged other civil-rights violations by jail 

officials, the defendants moved to dismiss, arguing that he had defrauded the court in 

two ways. First, Hughes had omitted from his IFP application $500 in gifts that he had 

recently received. Second, he had instructed his brother, who typically deposited 

money into Hughes’s account, to deposit $134 (in two transactions) to other inmates’ 

accounts for his personal use in order to avoid paying the outstanding filing fees. In 

support the defendants attached documents reflecting his brother’s deposit activity, 

including those into Hughes’s cellmates’ accounts, and recordings of two phone calls 

with his brother. The calls appear to confirm his scheme to avoid filing fees: 

 He had $9,000 in fees from “put[ting] the lawsuits in” and was “waiting 

for the settlement to pay [those] off.” 

 “But for right now, this is the way to get around it.” 

 But “I don’t talk about that, because [jail officials] record these 

conversations ... . They take these conversations and give it to the 

judge.” 

The judge ordered Hughes to explain why, in light of this evidence suggesting 

that he was diverting funds to avoid his debts, the court should not dismiss all his cases 

with prejudice. Hughes argued that although he directed funds to other inmates’ 

accounts, he did so to remain eligible for a jail program that provided him with free 

hygiene products, not to defraud the court. He explained that the jail based his 
No. 20-1635 Page 3 

eligibility for that program on his incoming deposits, not on the balance of his account 

after deductions for his debts. 

The judge dismissed Hughes’s eight pending suits with prejudice, finding that he 

had defrauded the court in its effort to collect the filing fees. The judge reasoned that 

Hughes “undoubtedly” wanted to “thwart” collection of the filing fees because “he said 

so” to his brother on the call. And, the judge noted, the regular and frequent deposits to 

his account had suspiciously ceased. In the almost four years since Hughes entered the 

jail, up until the month before he asked the court about his unpaid filing fees, he had 

received 74 deposits totaling over $3,700, most of which came from the same sources, 

including his brother. Shortly after he received an accounting of the debts he owed to 

the court, however, Hughes had only one deposit to his account in the amount of $10. 

So there was reason to be concerned that Hughes was structuring transactions to avoid 

paying the filing fees. Given the gravity of Hughes’s misconduct, dismissal with 

prejudice was appropriate. He had defrauded two public institutions (the court and jail). 

The judge stated that dismissal without prejudice and permitting him to refile would 

amount to no real sanction. She wanted to send a “firm message” about the need to 

remain truthful throughout the litigation process. 

On appeal Hughes insists that he did not mean to defraud the court. He meant 

only to remain eligible for the jail’s hygiene-product program, and he never lied to the 

court in his IFP affidavit or failed to disclose any of his finances. 

The judge did not clearly err in rejecting this defense and finding that Hughes 

intentionally concealed assets to defraud the court. See Thomas v. Gen. Motors Acceptance 

Corp., 288 F.3d 305, 308 (7th Cir. 2002) (describing the standard of review). First, it is 

irrelevant that Hughes may not have lied on his IFP affidavit. Courts can, in an 

oversight role, monitor a prisoner’s finances “to ensure that the prisoner does not 

deplete his trust account in order to avoid paying the filing fee.” Robertson v. French, 

949 F.3d 347, 353–54 (7th Cir. 2020); see also Sultan v. Fenoglio, 775 F.3d 888, 891 (7th Cir. 

2015). Second, the judge permissibly found that Hughes was brazenly depleting his 

assets to avoid paying his debts to the court. Hughes stated on a call (a recording he 

knew a judge may receive) that he wanted his brother to deposit his money into other 

inmates’ accounts. And far from saying, as he now claims, that this scheme would help 

him remain eligible for a jail program, he admitted that diverting his assets was the way 

to “get around” the “fees” he owed from “put[ting] the lawsuits in.” Finally, even if he 

diverted assets only to defraud the jail and not the court, Hughes should have told that 

to the court before hiding the assets so it could evaluate the legitimacy of the scheme. 
No. 20-1635 Page 4 

See Kennedy v. Huibregtse, 831 F.3d 441, 443 (7th Cir. 2016) (“[H]iding assets is not a 

permissible alternative to seeking the judge’s assistance. An [IFP] applicant has to tell 

the truth, then argue to the judge why seemingly adverse facts ... are not dispositive.”). 

Next, Hughes argues that even if some sanction was appropriate, the judge 

should not have punished him with dismissal with prejudice. He contends that he 

diverted only $134 and that he offered (in a motion for relief from the judgment) to raise 

money to pay some of the filing fees. It is “beyond question” that a court may dismiss a 

case with prejudice as a sanction in an appropriate case. Thomas, 288 F.3d at 306. Before 

doing so, however, a judge should “generally consider” lesser sanctions first. Hoskins v. 

Dart, 633 F.3d 541, 544 (7th Cir. 2011). Here, the judge did just that, noting that dismissal 

with prejudice was “proportionate to the gravity” of Hughes’s deliberate concealment 

of assets. First, she had warned Hughes not to hide assets, to no avail. Second, even 

though Hughes was caught on tape discussing hiding less than $200, the judge 

reasonably found that Hughes was scheming for more diversions because he had asked 

about his outstanding debts and altered his longtime deposit patterns to avoid paying 

them. Third, the judge also considered dismissal without prejudice but noted that it 

would be too lenient considering the “numerous deeply troubling aspects of [Hughes’s] 

conduct.” Accepting an asset-concealer’s belated offer to pay his debts would not deter 

others from trying to get away with a similar fraud. 

Finally, Hughes raises two procedural matters. First, he argues that the judge 

should not have considered the phone calls without permitting him to contest the 

recordings’ authenticity. He cites Diamond v. Pitchess, 411 F.2d 565, 566–67 (9th Cir. 

1969), where a district court sua sponte dismissed a suit as frivolous, relying on its incamera review of government reports. Unlike Diamond, the court here dismissed 

Hughes’s suit not as frivolous but as a sanction for fraud and only after giving him 

notice of the possible sanction and a chance to respond. That process was sufficient. See 

Donelson v. Hardy, 931 F.3d 565, 569 (7th Cir. 2019). Next, Hughes claims that the 

recordings were not exchanged with him. However, he does not challenge the 

defendants’ reliance on the certificate of service showing that copies of the recordings 

were mailed to the jail well before his brief was due. He otherwise fails to develop his 

argument, so it is waived. See Shipley v. Chi. Bd. of Election Comm’rs, 947 F.3d 1056, 1063 

(7th Cir. 2020). 

We considered Hughes’s other arguments, and none has merit. 

AFFIRMED