## Facts

- Joint debtors filed a Chapter 13 bankruptcy petition that was later converted to Chapter 7.
- The bankruptcy estate included a long-pending employment-discrimination lawsuit valued by the debtors at approximately $2.7 million.
- The Chapter 7 trustee proposed settling the lawsuit for $200,000, an amount sufficient to pay all allowed claims in full.
- The debtors opposed the settlement and sought dismissal under 11 U.S.C. § 521(i)(2), asserting they had not timely filed certain required financial disclosures (including pay advices and a statement of monthly net income) within the 45-day period in § 521(i)(1).
- The bankruptcy court found the missing disclosures unnecessary to administer the estate given the proposed settlement’s ability to satisfy creditors fully.
- The bankruptcy court denied dismissal and entered an order excusing the missing disclosures under § 521(a)(1)’s “unless the court orders otherwise” clause, despite the expiration of the 45-day period.
- The district court reversed, concluding the bankruptcy court lacked authority to excuse compliance after the 45-day deadline.
- The trustee appealed.

## Issues

1. Whether 11 U.S.C. § 521(i)(1) mandates dismissal on the 46th day whenever a debtor has not filed all § 521(a)(1) materials within 45 days, regardless of later case circumstances.
2. Whether a bankruptcy court may “order otherwise” under § 521(a)(1) after the 45-day period, thereby preventing dismissal under § 521(i).

## Decision

- The First Circuit reversed the district court and reinstated the bankruptcy court’s orders.
- The court held the bankruptcy court retained authority to “order otherwise” under § 521(a)(1) even after the 45-day period.
- Because an “order otherwise” can render particular disclosures not “required under subsection (a)(1),” the predicate for § 521(i)(1) dismissal may be absent.
- The court approved denying dismissal where the missing disclosures had become irrelevant to estate administration and dismissal would harm creditor interests.

## Legal Principles

- Section 521(a)(1)’s “unless the court orders otherwise” language grants bankruptcy courts discretion to waive or excuse specified filing requirements.
- Section 521(i)(1)’s dismissal mechanism applies only when the debtor fails to file information that remains “required under subsection (a)(1).”
- Nothing in the statute imposes an express temporal limit requiring the “order otherwise” to be entered within the initial 45-day period.
- Courts may reject dismissal efforts that function as debtor strategy to terminate a case after noncompliance when the omitted information is extraneous and dismissal would defeat creditor recovery.

## Conclusion

The First Circuit held that a bankruptcy court may, even after the 45-day deadline, excuse otherwise required § 521(a)(1) filings when they are no longer needed, thereby preventing dismissal under § 521(i) and protecting creditor interests.


In re Acosta-Rivera, 557 F.3d 8 (1st Cir. 2009)