Picture a family with a bankruptcy case open. The court sets a hearing, or signs the order that wipes out their debts. Then it sends a notice. Since Oct. 9, that notice may not be going out. The federal system that delivers them went dark after a security problem at the company that runs it. As of the Weekend paper, it had been down more than a week.
The Administrative Office of the U.S. Courts said so in a notice on Thursday, Oct. 15. The system sends case-filing alerts, hearing schedules and discharge orders for the bankruptcy courts. BAE Systems runs it for the government. Akiko Matsuda of WSJ Pro Bankruptcy reported the story in the Weekend Journal.
BAE says the incident is limited to the Bankruptcy Noticing Center and no other systems are affected. A spokesperson said it has taken immediate steps. It wouldn't say more, and it gave no estimate of when the system comes back. The courts office declined to comment. Several bankruptcy courts put the start of the outage at Oct. 9.
Each court is making its own rules
There's no single fix, so each district is handling it alone. In the Eastern District of New York, Chief Judge Jil Mazer-Marino ruled that missing a deadline because of the outage won't cost anyone a penalty or a legal right. In the Eastern District of Texas, Chief Judge Brenda Rhoades added 30 days of protection from debt collection. It covers repeat personal cases filed on or after Sept. 14. The debtor has to file a motion to get it. The Western District of North Carolina says on its website it'll handle delays case by case, and lawyers can file a motion.
Read that list again. The relief is different in every courthouse, and in Texas you have to ask for it. A person who missed a deadline in one district is covered. In another, they need a lawyer to file paperwork. And a creditor who never got notice of a filing could keep calling, because the paper that tells them to stop may not have arrived.
Our read
This is Consumer Protection (M11), and it's a reminder that a legal right is only as good as the notice that delivers it. The shield from collectors, the hearing date and the discharge order each travel by notice. Right now that notice may not travel. One court has said missed deadlines won't be punished. Others want a motion, or will decide case by case. Fair treatment isn't automatic, and it isn't the same everywhere.
If you, a parent or an adult child have a case open, the check this week is the court docket, since the mailbox may be empty. Ask the attorney to pull the case on PACER, the courts' online records system. Have them read you the last few entries and every upcoming date. If a creditor is still calling, the attorney can send them the case number directly. If the case is in East Texas, ask whether the motion for the extra 30 days has been filed, because it isn't automatic. If nobody in your family has a case open, it's still worth knowing how to check before you need to. The umbrella's worth finding while the sky is still gray.