Law360 (November 2, 2026, 4:25 PM EST) -- Some U.S. Supreme Court justices considering a First Step Act case Monday appeared caught off guard by a government lawyer's argument that the defendant's impending release from prison renders the appeal moot.

During oral arguments, the top court grappled with the prospect of dismissing William Maxwell's case without deciding whether prisoners may bring habeas petitions to seek early release under the sentencing reform law, potentially leaving a circuit split unresolved.

Maxwell, a convicted and disbarred Texas lawyer, is set to be released from prison Jan. 22, 2027. Kevin J. Barber, an assistant to the U.S. solicitor general, told the justices that if they try to decide the case before then, "you would probably also want to issue your judgment forthwith, so that the mootness doesn't occur during the rehearing period."

"So, even if it's not moot here, it's going to be moot down there [in the lower court] real quick, is what you're telling us?" Justice Neil Gorsuch asked.

"Absolutely, yes," Barber replied.

Barber told the justices that they should dismiss the case as improvidently granted. But he acknowledged under questioning that the government had not raised that argument when the Supreme Court was initially deciding whether to hear the case.

"That was our bad," Barber told the justices.

Justice Sonia Sotomayor asserted that Barber was now trying to "win on an argument that you failed to raise on cert."

Barber replied, "We're asking—"

"That's what you want to do. Enough," Justice Sotomayor said, cutting him off.

Justice Gorsuch later told Barber, "I haven't heard 'my bad' before at the podium. Good on you."

Maxwell is serving a 20-year federal sentence following his 2014 conviction in New Jersey on racketeering, conspiracy and fraud-related charges for his role in La Cosa Nostra takeover of Texas-based mortgage loan company FirstPlus Financial Group Inc.

Maxwell contends that the district court and the Fifth Circuit incorrectly determined that he could not challenge the federal Bureau of Prisons' denial of his application for early transfer from prison to a halfway house or home confinement under the First Step Act through a habeas petition brought under U.S. Code Section 2241.

The Supreme Court has taken up several cases this year centered on interpretations of the First Step Act and its scope. The law was part of a sweeping effort to provide relief from mandatory minimum prison sentences and promote rehabilitation.

Over the summer, the justices issued opinions in two other cases — Fernandez v. U.S. and Rutherford v. U.S. — that limited the discretion of judges and the U.S. Sentencing Commission in certain types of First Step Act cases.

In Maxwell's case, the district court initially found that he had failed to exhaust his administrative remedies. The Fifth Circuit did not address that issue, but it affirmed the lower court's ruling, saying Maxwell's claim under Section 2241 could only survive if a favorable ruling would "automatically entitle [him] to accelerated release."

The Eighth Circuit has reached the same conclusion, which conflicts with rulings from the First, Second and Third Circuits, according to Maxwell's Supreme Court filings.

Arguing for Maxwell on Monday, Masha Hansford, a partner at Davis Polk & Wardwell LLP, told the justices that the Fifth Circuit had wrongly dismissed Maxwell's case "on the grounds that habeas is only available where a prisoner seeks complete release."

She noted that neither the government nor the attorney appointed by the Supreme Court to serve as amicus in support of the Fifth Circuit's reasoning "defends that rule here."

"Instead, amicus acknowledges that habeas is available for some level of custody claims, but he argues not for Mr. Maxwell's claim here," Hansford said.

She added, "Amicus' efforts to limit habeas finds no footing in statutory text or in history, and he offers no principled basis for distinguishing the types of claims that are in from those that are out."

Justice Ketanji Brown Jackson suggested that the court could issue a narrow ruling based on the specific circumstances of Maxwell's case, rather than using "this case to define every circumstance in which habeas is appropriate."

The narrow question, Justice Jackson said, is whether a prisoner is able to bring a habeas claim that "he's being unlawfully detained because he's entitled to placement in a halfway house if his good-time credits had been calculated properly."

"That's completely fair, Justice Jackson," Hansford said. "We're happy with a narrow ruling here."

The court-appointed amicus, Brian W. Barnes of Cooper & Kirk PLLC, argued that Maxwell's claim for relief under the First Step Act "may be pursued, if at all, only as a civil rights claim." He also stressed that if Maxwell "wins this lawsuit, his term of imprisonment won't be shortened by even a single day."

Wrapping up the arguments, Hansford used her rebuttal to urge the justices not to dismiss the case as moot without deciding Maxwell's argument, which she framed as a "heartland habeas claim."

"There's just no reason for this court to have buyer's remorse on this case," she said.

Maxwell is represented by Masha G. Hansford of Davis Polk & Wardwell LLP.

The government is represented by D. John Sauer and Kevin J. Barber of the U.S. Department of Justice.

Brian W. Barnes of Cooper & Kirk PLLC serves as court-appointed amicus.

The case is Maxwell v. Dinis, case No. 25-5930, in the U.S. Supreme Court.

--Editing by Karin Roberts.

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