United States Court of Appeals 

For the First Circuit 

No. 17-1984 

IN RE: STEVEN FUSTOLO, 

Debtor. 

_____________________ 

STEVEN FUSTOLO, 

Appellant, 

v. 

THE PATRIOT GROUP LLC, 

Appellee. 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF MASSACHUSETTS 

[Hon. Leo T. Sorokin, U.S. District Judge] 

Before 

Torruella, Thompson, and Kayatta, 

 Circuit Judges. 

Martin P. Desmery, with whom Travis J. McDermott and Partridge 

Snow & Hahn, LLP were on brief, for appellant. 

Jack I. Siegal, with whom Gordon & Rees Scully Mansukhani was 

on brief, for appellee. 

July 16, 2018 
-2- 

TORRUELLA, Circuit Judge. Following trial on The 

Patriot Group, LLC's ("Patriot") adversary complaint requesting 

denial of the discharge in bankruptcy of Steven Fustolo's 

("Fustolo") debt, the bankruptcy court allowed Patriot's motion to 

amend its pleadings and denied Fustolo's discharge pursuant to the 

newly added claim. Fustolo seeks reprieve from his encumbrance, 

imploring us to reverse the bankruptcy court's judgment and remand 

the case for reconsideration in light of the issues pleaded in 

Patriot's complaint. Because we find that the allowance of this 

belated amendment fails to satisfy the prescripts of due process 

underlying Rule 15(b)(2) and was therefore an abuse of discretion, 

we grant Fustolo's request. 

I. FACTUAL AND PROCEDURAL BACKGROUND 

We begin by charting the course of this case, as 

supportably summarized by the district court and undisputed by the 

parties. See Fustolo v. The Patriot Group, LLC (In re Fustolo), 

No. 17-cv-10128-LTS, 2017 WL 3896667, at *1-5 (D. Mass. Sept. 6, 

2017). After obtaining a $20.5 million dollar judgment against 

Fustolo from the Massachusetts Superior Court two years earlier, 

Patriot and two other petitioning creditors filed a contested 

involuntary petition for relief under Chapter 7 of the Bankruptcy 

Code in May 2013 against Fustolo. On December 16, 2013, the 

bankruptcy court allowed the petition for relief. In re Fustolo, 
-3- 

503 B.R. 206 (Bankr. D. Mass. 2013), aff'd, Fustolo v. 50 Thomas 

Patton Drive, LLC, 816 F.3d 1 (1st Cir. 2016). 

On September 30, 2014, Patriot and another petitioning 

creditor filed an adversary complaint requesting denial of 

Fustolo's discharge in bankruptcy pursuant to 11 U.S.C. 

§ 727(a)(2)(A), (a)(2)(B), (a)(3), (a)(4), (a)(5), and, in the 

alternative, that the court declare Fustolo's debt nondischargeable pursuant to 11 U.S.C. § 523(a)(2), (a)(4). Among 

other things, the complaint alleged that Fustolo engaged in 

fraudulent transactions as to both creditors; deliberately created 

a corporate web to conceal fraudulent activities; made substantial 

pre-petition transfers to his wife; made unexplained cash 

transactions within one year of the involuntary petition; made 

substantial transfers to insiders and affiliates; concealed, 

destroyed, or failed to keep business records from which the 

creditors could ascertain the financial condition of Fustolo's 

business transactions; and made false statements during 

bankruptcy.

In November 2015, Patriot filed a motion to compel 

Fustolo to provide emails and financial records that Patriot 

alleged were being wrongfully withheld. In a contested hearing 

on Patriot's motion, Fustolo argued that his emails had been 

deleted by his email account provider and were therefore 
-4- 

irretrievable, and that, in any event, many of them were protected 

from production by the Fifth Amendment's right against selfincrimination.1

On December 31, 2015, the bankruptcy court issued an 

order (the "December 31 Order") for Fustolo to produce nonprivileged emails and financial account statements to Patriot, and 

in consideration of Fustolo's Fifth Amendment rights, to "provide 

the Court for its in camera inspection only . . . copies of all 

emails and documents he asserts are protected under the Fifth 

Amendment, along with two separate item by item indexes" (the 

"Protocol"). The bankruptcy court stated that it would determine 

whether the privilege had been properly invoked, and added that 

submission of the emails and financial statements "shall not 

constitute a waiver of [Fustolo's] Constitutional right against 

self-incrimination." In the court's accompanying memorandum, it 

noted that Fustolo's contention about the email provider's 

deletion of emails was "devoid of merit," and that if Fustolo was 

"unable to produce emails, it can only mean that he deleted them." 

50 Patton Drive, LLC v. Fustolo (In re Fustolo), No. 13-12692-JNF, 

2015 WL 9595421, at *4 (Bankr. D. Mass. Dec. 31, 2015).

 

1 In 2015, Patriot initiated an investigation of Fustolo, which 

led the Massachusetts Attorney General to file a criminal matter 

against Fustolo in the Massachusetts state court.
-5- 

After being granted two extensions of time to comply 

with the December 31 Order, on February 5, 2016, Fustolo filed a 

motion to impound submission regarding his assertion of the Fifth 

Amendment, in which he stated that he was not complying with the 

December 31 Order by refusing to submit emails. Patriot 

subsequently filed a motion for sanctions against Fustolo pursuant 

to Fed. R. Civ. P. 37 for failing to comply with the December 31 

Order and for alleged email spoliation. The bankruptcy court held 

a hearing on Patriot's motion on March 17, 2016,2 at which Patriot 

requested as sanctions: that the bankruptcy court set an 

expeditious trial date; that Fustolo be required to submit to a 

deposition; and an order that Patriot was "not going to get dumped 

on with emails on the eve of trial." In response, Fustolo again 

responded that production of emails and documents for in camera 

inspection would violate his Fifth Amendment rights in light of 

the "overriding concern that [the bankruptcy court] is the finder 

of fact in this case." The court made clear at the hearing that 

it had "gone to great lengths to protect Mr. Fustolo's right to 

invoke the Fifth Amendment," but that Fustolo had "refused to 

comply . . . without legitimate reason." In addition, the court 

 

2 While the transcript of this hearing and Patriot's appellate 

brief reflect the date of this hearing as March 17, 2015, Patriot's 

motion for sanctions was filed on February 16, 2016, and the docket 

reflects the hearing took place on March 17, 2016.
-6- 

found that Fustolo failed to comply with the December 31 Order by 

deleting emails that he had not claimed to be privileged or 

refusing to provide them to Patriot, and by failing to comply with 

the Protocol. See id. Accordingly, the court granted Patriot's 

motion for sanctions, prohibited Fustolo from presenting any 

emails not previously produced, and scheduled the trial to commence 

on May 23, 2016.

During his deposition, Fustolo provided to Patriot paper 

print outs of what he claimed were his "books and records," but 

refused to produce the electronic spreadsheets from which the 

information was derived, repeatedly invoking the Fifth Amendment 

right against self-incrimination. Fustolo further invoked his 

Fifth Amendment right when asked if he intentionally deleted his 

electronic spreadsheets. On May 10, 2016, Patriot again moved for 

sanctions pursuant to Fed. R. Civ. P. 37, seeking a pretrial ruling 

that Fustolo had spoliated the electronic financial records, and 

a court order barring Fustolo from introducing into evidence any 

documents or financial records not produced in their original 

electronic format. On May 18, 2016, the bankruptcy court granted 

Patriot's motion in part and denied it in part, prohibiting Fustolo 

from introducing any evidence not provided prior to his deposition, 

but refraining from making a finding as to whether Fustolo 

intentionally spoliated his books and records.
-7- 

In a Joint Pretrial Memorandum ("JPM"), Patriot included 

"Fustolo's discovery misconduct in this proceeding, including but 

not limited to Fustolo's spoliation of evidence" among its "fact 

issues for trial." Fustolo did not file an objection to the 

inclusion of this issue. Three days before trial, Patriot filed 

a request for the bankruptcy court to take judicial notice of 

several documents, including: 1) the December 31 Order; 2) the 

December 31 accompanying memorandum; 3) the transcript of the 

March 17, 2016 hearing; 4) the court's May 18, 2016 order on 

Patriot's motion for a spoliation inference. The court allowed 

the request with no objection from Fustolo.

Trial started on May 23, 2016. The court began by 

reciting the allegations in the complaint: that Patriot had an 

objection to discharge of Fustolo's debt under 11 U.S.C. 

§ 727(a)(2)(A) as Count I, § 727 (a)(2)(B) as Count II, 

§ 727 (a)(3) as Count III, § 727 (a)(4) as Count IV, and 

§ 727 (a)(5) as Count V; and that Patriot further alleged that 

Fustolo's debt was non-dischargeable under § 523(a)(2)(A) as 

Count VIII.3 The parties confirmed that there were no amendments. 

In Patriot's opening statement, Patriot's counsel offered that the 

evidence would "show that Mr. Fustolo ha[d] repeatedly abused the 

 

3 Counts VI and VII related to claims by another creditor that 

previously dismissed its claims against Fustolo.
-8- 

bankruptcy process, violated this Court's orders, [and] failed to 

preserve evidence." The bankruptcy court immediately asked 

whether Patriot had a claim under § 727(a)(6), and counsel stated 

that Patriot did not.

On June 14, 2016, the fourth of six days of trial, during 

Fustolo's testimony, Patriot's counsel questioned him about his 

compliance with the December 31 Order. The following exchange 

took place: 

COUNSEL: In December of 2015 the Court entered an 

order in which you were to provide the 

Court in camera documents that you 

contend you were withholding based on the 

Fifth Amendment privilege. Do you 

recall that? 

FUSTOLO: I do, yes. 

COUNSEL: You never produced those documents to the 

Court, did you? 

FUSTOLO: My attorney supplied them to the Court, 

yes. 

COUNSEL: I don't believe that you followed – there 

was a protocol that you were supposed to 

follow in terms of providing documents 

withheld on Fifth Amendment grounds, as 

well as a log of documents. Sir, do you 

know whether you complied with that 

order? 

FUSTOLO: Sir, I relied on my counsel who believed 

that – that compliance had been adhered 

to. 

. . . 
-9- 

COUNSEL: Are you telling the Court right now under 

oath that you supplied all the documents 

withheld on the Fifth Amendment privilege 

to the Court? 

FUSTOLO: Sir, I relied on my counsel for that, so 

whatever they said we complied with, we 

complied with. 

At no point did Fustolo's trial counsel object to any of these 

questions. Moreover, Fustolo's counsel did not address the 

December 31 Order during his cross-examination of Fustolo. At the 

close of evidence, the bankruptcy court requested that the parties 

submit post-trial briefs in lieu of closing arguments, structuring 

their briefs "along the lines of the claims for relief that are 

set forth in the counts on the plaintiff's complaint." The court 

again read aloud the counts in Patriot's complaint, and gave the 

parties approximately two months to submit their post-trial 

briefs.

Both parties filed their post-trial briefs on August 26, 

2016. In the last pages of Patriot's brief, it moved to amend its 

complaint to conform to the evidence presented at trial pursuant 

to Fed. R. Civ. P. 15(b)(2), requesting to include a claim under 

§ 727(a)(6) based on Fustolo's violation of the December 31 Order. 

Patriot identified several instances that it argued should 

constitute Fustolo's implied consent to litigate the additional 

claim, including Fustolo's failure to object to: Patriot's 

inclusion of "Fustolo's discovery misconduct" as an issue for trial 
-10- 

in the JPM; Patriot's request for judicial notice of the December 

31 Order; and Fustolo's above-quoted testimony at trial. Patriot 

subsequently filed a Motion to Conform the Pleadings to the 

Evidence on September 12, 2016, and Fustolo filed his opposition 

on September 28.

On January 9, 2017, the bankruptcy court allowed 

Patriot's motion to conform and entered judgment in its favor and 

against Fustolo, denying Fustolo a discharge of his debt owed in 

bankruptcy under § 727(a)(6). The Patriot Group, LLC v. Fustolo 

(In re Fustolo), 563 B.R. 85 (Bankr. D. Mass. 2017). In light of 

its ruling as to the newly asserted claim, the bankruptcy court 

found the remaining counts of Patriot's complaint moot. Id. at 

113.

On January 24, 2017, Fustolo filed his Notice of Appeal 

and Statement of Election to have his appeal of the bankruptcy 

court's January 9 order heard before the district court rather 

than the Bankruptcy Appellate Panel. The district court affirmed 

the bankruptcy court on September 6, 2017, and Fustolo timely 

appealed. 

II. THE UNPLEADED CLAIM 

On appeal, Fustolo advances two arguments before this 

Court: that the bankruptcy court abused its discretion in granting 

Patriot leave to amend its complaint, and that § 727(a)(6) does 
-11- 

not apply to his assertion of his Fifth Amendment right against 

self-incrimination. The decision whether to grant or deny an 

amendment is within the discretion of the trial court, see Foman 

v. Davis, 371 U.S. 178, 182 (1962), and we review its 

determinations of implied consent for an abuse of that discretion, 

Premier Capital, LLC v. Crawford (In re Crawford), 841 F.3d 1, 6 

(1st Cir. 2016). This standard is "generally deferential," 

although a "material error of law is invariably an abuse of 

discretion." Charbono v. Sumski (In re Charbono), 790 F.3d 80, 

85 (1st Cir. 2015) (citing Berliner v. Pappalardo (In re Sullivan), 

674 F.3d 65, 68 (1st Cir. 2012)). 

"Notwithstanding the fact that we are the second-in-time 

reviewers, we cede no special deference to the district court's 

determinations." In re Crawford, 841 F.3d at 6 (quoting Gannett 

v. Carp (In re Carp), 340 F.3d 15, 22 (1st Cir. 2003)). 

Accordingly, we directly review the bankruptcy court's order. In 

re Charbono, 790 F.3d at 84-85. 

When engaging in our review, we keep in mind that "the 

district courts retain the inherent power to do what is necessary 

and proper to conduct judicial business in a satisfactory manner." 

Rodríguez v. Doral Mortg. Corp., 57 F.3d 1168, 1171 (1st Cir. 1995) 

(quoting Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1119 (1st Cir. 

1989)). Further, while motions to amend a complaint to conform 
-12- 

to the evidence at trial are liberally allowed, Noonan v. Rauh (In 

re Rauh), 119 F.3d 46, 52 (1st Cir. 1997), such amendments must 

conform to the prescripts of due process, see Nelson v. Adams USA, 

Inc., 529 U.S. 460, 465 (2000). 

We begin with a discussion of the applicable rule 

governing amendments of pleadings. 

A. Rule 15(b)(2)4

Rule 15(b)(2) states, in relevant part, that "[w]hen an 

issue not raised by the pleadings is tried by the parties' express 

or implied consent, it must be treated in all respects as if raised 

in the pleadings." See Antilles Cement Corp. v. Fortuño, 670 F.3d 

310, 319 (1st Cir. 2012) ("Federal Rule of Civil Procedure 15(b) 

allows an unpleaded claim to be considered when the parties' 

conduct demonstrates their express or implied consent to litigate 

the claim."). As the record in this case shows no indication of 

Fustolo's express consent, nor do any parties so claim, we look 

only to whether Fustolo provided his implied consent. 

Implied consent occurs by either "treating a claim 

introduced outside the complaint 'as having been pleaded, either 

through [the party's] effective engagement of the claim or through 

 

4 Federal Rule of Civil Procedure 15(b) is made applicable in 

bankruptcy proceedings pursuant to Bankruptcy Rule 7015. See In 

re Rauh, 119 F.2d at 52. 
-13- 

his silent acquiescence'; or by acquiescing during trial 'in the 

introduction of evidence which is relevant only to that issue.'" 

Id. (alteration in the original) (emphasis added) (quoting Doral 

Mortg., 57 F.3d at 1172); see also Conjugal P'ship of Jones v. 

Conjugal P'Ship of Pineda, 22 F.3d 391, 400-01 (1st Cir. 1994) 

("One sign of implied consent is that issues not raised by the 

pleadings are presented and argued without proper objection by 

opposing counsel." (quoting Matter of Prescott, 805 F.2d 719, 725 

(7th Cir. 1986))). 

Engagement or acquiescence to the litigation of an 

unpleaded claim may occur through a party's failure to object once 

it becomes clear that the asserted claim is being incorporated 

into the pleadings. See, e.g., Antilles Cement, 670 F.3d at 319-20 

(finding that appellants "effectively conceded" that new claim had 

been "incorporated into the complaint" by discussing the claim at 

the first scheduling conference, failing to object to the claim's 

listing in the scheduling order, engaging in discovery pertaining 

to the new claim, briefing the issue, and arguing contesting the 

claims merits). However, "[t]he introduction of evidence directly 

relevant to a pleaded issue cannot be the basis for a founded claim 

that the opposing party should have realized that a new issue was 

infiltrating the case." DCPB, Inc. v. City of Lebanon, 957 F.2d 

913, 917 (1st Cir. 1992), superseded on other grounds, as 
-14- 

recognized in Lamboy-Ortiz v. Ortiz-Vélez, 630 F.3d 228, 243 n.25 

(1st Cir. 2010). It is "the defendant's inalienable right to know 

in advance the nature of the cause of action being asserted against 

him," Doral Mortg., 57 F.3d at 1171, and thus "[i]t is not enough 

that an issue may be inferentially suggested by incidental evidence 

in the record; the record must demonstrate that the parties 

understood that the evidence was aimed at an unpleaded issue," 

Galindo v. Stoody Co., 793 F.2d 1502, 1513 (9th Cir. 1986); 

see also Kenda Corp., Inc. v. Pot O'Gold Money Leagues, Inc., 

329 F.3d 216, 232 (1st Cir. 2003) (citing Galindo for this 

proposition); Monod v. Futura, Inc., 415 F.2d 1170, 1174 (10th 

Cir. 1969) (stating that Rule 15(b) serves "to bring the pleadings 

in line with issues actually tried and does not permit amendment 

to include collateral issues which may find incidental support in 

the record"). 

Finally, while the court has the discretion to allow 

late amendments, it may do so only if the non-moving party will 

not suffer undue prejudice. Campana v. Eller, 755 F.2d 212, 215 

(1st Cir. 1985); see also In re Rauh, 119 F.3d at 52 (amendment 

should not be allowed if opposing party demonstrates "unfair 

prejudice" (citing DCPB, 957 F.2d at 917)); DCPB, 957 F.2d at 917 

("It is axiomatic that amendments which unfairly prejudice a 

litigant should not be granted."). "At a bare minimum . . . a 
-15- 

defendant must be afforded both adequate notice of any claims 

asserted against him and a meaningful opportunity to mount a 

defense." Doral Mortg., 57 F.3d at 1172. Lack of prejudice, 

however, does not "compel a determination that the amendment is 

appropriate." Kenda Corp., 329 F.3d at 232 (quoting United States 

v. Davis, 261 F.3d 1, 59 (1st Cir. 2001)). 

B. The January 9, 2017 Order 

We refocus our lens on the plaint before us. Amongst 

the claims that Patriot pleaded in its complaint were requests for 

denial of discharge of Fustolo's debt under 11 U.S.C. § 727(a)(3), 

which allows for a denial when a debtor has "concealed, destroyed, 

mutilated, falsified, or failed to keep or preserve any recorded 

information, including books, documents, records, and papers, from 

which the debtor's financial condition or business transactions 

might be ascertained," and 11 U.S.C. § 727(a)(4), which allows for 

denial if a debtor has "knowingly and fraudulently, in or in 

connection with the case . . . made a false oath or account." In 

its motion to conform, Patriot requested that the bankruptcy court 

allow it to assert a claim and obtain a judgment against Fustolo 

under 11 U.S.C. § 727(a)(6), which provides for denial of discharge 

of a "debtor [that] has refused, in the case . . . to obey any 

lawful order of the court, other than to respond to a material 

question or to testify." 
-16- 

As previously noted, the bankruptcy court allowed 

Patriot's request for amendment and judgment on the unpleaded 

claim, finding that Fustolo had been put on notice of a possible 

§ 727(a)(6) claim prior to trial, and that the unpleaded claim was 

foreseeable as early as March 17, 2016. In re Fustolo, 563 B.R. 

at 106-08. The court reasoned that Fustolo "impliedly consented 

to the litigation of the unpleaded § 727(a)(6)(A) claim" by filing 

the JPM, and "through his silent acquiescence and failure to object 

to the introduction of evidence directly relevant to that claim." 

Id. at 106, 108. According to the court, Fustolo's acceptance 

occurred through: 1) the inclusion of the "discovery misconduct" 

issue in the JPM; 2) his failure to object to the court taking 

judicial notice of the December 31 Order and accompanying 

memorandum, and the transcript of the March 17, 2016 hearing; and, 

3) his acquiescence to Patriot's line of questioning about the 

December 31 Order. Id. at 108. The court also found the 

introduction of the December 31 Order, the accompanying 

memorandum, the March 17, 2016 hearing transcript, and Patriot's 

questioning of Fustolo were all "more strongly relevant" to a 

§ 727(a)(6)(A) claim than alternative explanations offered by 

Fustolo. Id. (citing Haught v. Maceluch, 681 F.2d 291, 305 (5th 

Cir. 1982)). 
-17- 

Further, while acknowledging the belated timing of 

Patriot's motion to conform, the bankruptcy court pointed out that 

Patriot raised the issue in its post-trial brief, and that Rule 

15(b)(2) allows for amendments to pleadings "at any time, even 

after judgment." Id. at 108-09 (quoting Fed. R. Civ. P. 15(b)(2)) 

(quotation marks omitted). The court next found that Fustolo 

would not suffer any undue prejudice as he "had a full and fair 

opportunity to address his compliance with the December 31st Order 

at trial," and because the court could not imagine "what additional 

evidence Fustolo could offer" as to this claim. Id. at 109. 

Finally, after conducting an analysis under § 727(a)(6), the 

bankruptcy court concluded that Patriot had "show[n] by a 

preponderance of the evidence that Fustolo willfully and 

intentionally refused to obey a lawful order of this Court," which 

warranted denial of his discharge. Id. at 113.

In this appeal, Fustolo disputes the contention that he 

was put on notice about a potential § 727(a)(6) claim, and argues 

that the pre-trial filings, Patriot's request for judicial notice, 

and his testimony all related to the existing § 727(a)(3) or 

§ 727(a)(4) claims and ongoing discovery disputes. He avers that 

these pieces of evidence at most constituted "incidental evidence, 

which created nothing more than an inferential suggestion of a 

possible § 727(a)(6) claim." Fustolo faults the bankruptcy court 
-18- 

for utilizing the "most strongly relevant" test to find implied 

consent, and employing a "double standard" by imputing Fustolo's 

notice of a potential § 727(a)(6) claim in March 2016 while failing 

to require Patriot to justify its delayed amendment until September 

2016. Patriot's delay, he claims, was unfairly prejudicial as it 

precluded him the opportunity to consider the need for additional 

evidence. 

Patriot, on the other hand, maintains the accuracy of 

the bankruptcy court's discretionary decision, asserting that 

evidence of Fustolo's Protocol violation was relevant only to the 

unpleaded claim. Therefore, says Patriot, because Fustolo was on 

fair notice of the possible new claim and engaged on the merits at 

trial without objection, he impliedly consented to its addition. 

Patriot also contests any alleged prejudice to Fustolo as it posits 

that he had the opportunity to address the § 727(a)(6) claims, but 

simply failed to do so. As for why it waited until after trial 

to request amendment, Patriot points to discovery and trial 

preparation, and its desire to prevent Fustolo from seeking further 

postponement.

C. Fair Notice 

"Under the Civil Rules, notice of a claim is a 

defendant's entitlement, not a defendant's burden." Doral Mortg., 

57 F.3d at 1172. When evidence presented is relevant to a claim 
-19- 

actually pleaded, and not solely to a new issue, the non-moving 

party is not provided adequate notice that the new claim is being 

litigated. See DCPB, 957 F.2d at 917. Simply put, one cannot 

give implied consent to litigate a claim for which he or she is 

not provided notice. See Nickless v. Conley (In re Byers), 312 

B.R. 22, 25 (Bankr. D. Mass. 2004) ("The bounds of implied consent 

ensure that an opposing party receives fair notice of the claims 

against it which it must defend."); see also Triad Elec. & 

Controls, Inc. v. Power Sys. Eng'g, Inc., 117 F.3d 180, 193-94 

(5th Cir. 1997) ("[T]rial of unpleaded issues by implied consent 

is not lightly to be inferred under Rule 15(b) . . . in light of 

the notice demands of procedural due process." (quoting Jiménez v. 

Tuna Vessel "GRANADA", 652 F.2d 415, 422 (5th Cir. Unit A July 

1981)) (quotation marks omitted)). 

The bankruptcy court found that Fustolo was put on notice 

of the infiltration of a § 727(a)(6)(A) claim in the JPM, through 

the court's allowance of the judicial notice request, during 

Patriot's opening statement, and when Patriot questioned him at 

trial. We disagree, and find that none of these instances clearly 

indicated Patriot's intention to litigate a § 727(a)(6) claim such 

that Fustolo could have "understood that the evidence was aimed at 

an unpleaded issue." Galindo, 793 F.2d at 1513; see also Doral 

Mortg., 57 F.3d at 1172. We explain our reasoning. 
-20- 

1. The JPM 

The bankruptcy court found that including "discovery 

misconduct" as a factual issue for trial in the JPM "was a clear 

warning to Fustolo" that his failure to comply with the December 

31 Order would be a triable issue. Fustolo, 563 B.R. at 107. 

But, the discovery misconduct alleged in the JPM included 

spoliation of evidence, relevant to and actionable under Patriot's 

§ 727(a)(3) claim. Assuming "discovery misconduct" refers to 

Fustolo's refusal to provide Patriot non-privileged documents 

required by the December 31 Order, that contention was addressed 

at the March 17, 2016 hearing on Patriot's motion for sanctions, 

during which the bankruptcy court found it "inescapable that they 

have not been produced intentionally or have been deleted." 

Moreover, Patriot argued in its second Rule 37 motion -- filed 

only nine days prior to filing the JPM -- that Fustolo's invocation 

of the Fifth Amendment when asked to produce financial documents 

referenced in the December 31 Order should lead to an inference of 

spoliation. Thus, this "discovery misconduct" was relevant to 

whether Fustolo concealed, destroyed, or failed to preserve books 

and records under Patriot's existing § 727(a)(3) claim, and, 

because it was not solely relevant to the § 727(a)(6) claim, was 

insufficient for a finding of implied consent. 
-21- 

Patriot points to Fustolo's violation of the Protocol as 

an independent act of "discovery misconduct" at issue for which 

Fustolo was provided notice through the JPM. Apart from his 

refusal to turn over non-privileged documents, this violation 

involved Fustolo's failure to provide the court with emails and 

financial records that he asserted were shielded from production 

by the Fifth Amendment in order for the court to conduct an in 

camera inspection. Yet, this too cannot amount to adequate notice 

as this transgression also related to Patriot's § 727(a)(3) claim. 

At the March 17 hearing, the bankruptcy court announced its belief 

that Fustolo's defiance and "changes of position" as to why he was 

not providing emails were in "furtherance of a scheme to delay 

this litigation and legitimate discovery," and not as a result of 

the reasons that Fustolo previously stated to court. In its posttrial proposed findings of fact and conclusions of law, Patriot 

pointed to Fustolo's invocation of the Fifth Amendment privilege 

in relation to its § 727(a)(3) claim, and further argued that 

Fustolo's contrary representations about the emails supported an 

inference that he destroyed them. Additionally, the documents 

which Patriot alleges that Fustolo failed to provide to the 

bankruptcy court through his Protocol violation were the same 

documents that Patriot alleged were destroyed in its subsection 

(a)(3) claim.
-22- 

At the very least, the statements in the JPM were 

sufficiently broad as to not reasonably be perceived as germane 

exclusively to a new § 727(a)(6) claim rather than a pleaded issue. 

2. Request for Judicial Notice 

 Nor did Patriot's request for the court to take judicial 

notice of certain court documents provide adequate notice of the 

inclusion of a § 727(a)(6) claim. The bankruptcy court focused 

on Patriot's request for judicial notice of the December 31 Order 

and accompanying memorandum, and the transcript of the March 17, 

2016 hearing, finding that they were "more strongly relevant to a 

§ 727(a)(6)(A) claim than the theory espoused by Fustolo." Id. 

at 108. In the bankruptcy court's memorandum accompanying the 

December 31 Order, the court exclaimed its disbelief of Fustolo's 

contentions that his email provider deleted his emails, and laid 

out the underpinnings of a spoliation inference when it stated 

that "[i]f he is unable to produce emails, it can only mean that 

he deleted them." This, as well as the bankruptcy court's 

previously-mentioned "inescapable" conclusion at the March 17, 

2016 hearing that Fustolo intentionally withheld or deleted emails 

are undoubtedly pertinent to Patriot's § 727(a)(3) claim, and 

Fustolo's presumed destruction of emails are actionable as such. 

Regardless of whether the evidence contained within the 

judicially-noticed items are "more strongly relevant" to a 
-23- 

§ 727(a)(6) claim, Haught, 681 F.2d at 305 (quoting Wallin v. 

Fuller, 476 F.2d 1204, 1210 (5th Cir. 1973)), they are not relevant 

only to such a claim, see DCPB, 957 F.2d at 917. Therefore, the 

failure to object to the request for judicial notice cannot 

constitute implied consent. 

3. Patriot's Opening Statement 

We turn next to Patriot's opening statement at trial, at 

which Patriot's counsel proclaimed that "the evidence will also 

show that Mr. Fustolo has repeatedly abused the bankruptcy process, 

violated this Court's orders, failed to preserve evidence and based 

on the totality of all of the evidence we will ask your Honor to 

deny Mr. Fustolo a discharge with prejudice." The bankruptcy 

court found that this statement, and the court's subsequent inquiry 

about the existence (or lack thereof) of a subsection (a)(6) claim 

put Fustolo "on notice at the very outset of the trial of the 

possibility of a § 727(a)(6)(A) claim." In re Fustolo, 563 B.R. 

at 106. Fustolo argued before the bankruptcy court that Patriot's 

denial of the existence of an (a)(6) claim constituted a waiver, 

an argument that the court rejected. See id. 

Fustolo again raises this argument on appeal, adding for 

support Patriot's limited request for relief as sanctions for 

Fustolo's disobedience of the December 31 Order. We need not 

delve into the merits of this argument as we find that Patriot's 
-24- 

opening statement did not provide adequate notice of a trial on 

the failure-to-obey-a-lawful-court-order subsection (a)(6)(A) 

claim. The bankruptcy court reasoned that Patriot's accurate 

response about the absence of a § 727(a)(6) cause of action did 

not nullify the notice provided by Patriot's opening statement 

because later evidence, particularly his testimony, introduced at 

trial pertained to the unpleaded claim. Id. at 106-07. But, the 

bankruptcy court did not account for Patriot's failure to raise a 

request for amendment of its pleadings during the two trial days5

following Fustolo's testimony, and the court's own recitation at 

the trial's conclusion of the claims litigated, and Patriot's 

affirmation of those claims. Additionally, Patriot's inclusion 

of the court-order violation in its opening statement, combined 

with its disavowal of the existence of an (a)(6) claim immediately 

following, supports the conclusion that Fustolo's violation of 

court orders was relevant to the extant claims. Cf. United States 

v. Ciampa, 793 F.2d 19, 25 (1st Cir. 1986) (finding trial judge's 

interruption of opening statement alluding to evidence "of only 

collateral relevance" was justified); United States v. Hershenow, 

680 F.2d 847, 858 (1st Cir. 1982) ("The function of the defendant's 

opening statement is to enable him to inform the court and jury 

 

5 The trial was held on non-consecutive days.
-25- 

what he expects to prove . . . ." (alteration in original) (quoting 

United States v. Freeman, 514 F.2d 1184, 1192 (10th Cir. 1975))).

In light of this repeated confirmation that no 

§ 727(a)(6) claim was to be or had been litigated, and the 

ambiguity related to the "violat[ion] of this Court's orders" noted 

in part II(C)(1) supra, Patriot's opening statement did not provide 

adequate notice of the claim raised in Patriot's motion to amend. 

Patriot's lack of objection did not constitute implied consent. 

4. Fustolo's Testimony 

 Finally, we reach Patriot's examination of Fustolo on 

trial day four. The bankruptcy court found that Fustolo's failure 

to object to Patriot's line of questioning "constitute[d] 

acquiescence at trial in the introduction of evidence which was 

more strongly relevant to the issue of Fustolo's noncompliance 

with the December 31st Order." Fustolo, 563 B.R. at 108. 

Patriot's counsel's questions and Fustolo's answers addressed 

Fustolo's compliance, or non-compliance, with the December 31 

Order. But, again, the substance of the unchallenged testimony 

is pertinent to other claims already presented. While the 

testimony also relates to a possible § 727(a)(6) claim, stray 

references that arguably point to a new claim cannot easily 

generate a finding of acquiescence when they are accompanied by an 
-26- 

express disavowal of such a claim that is not itself recanted until 

months after the trial. 

Accordingly, Fustolo's testimony was not relevant only 

to the unpleaded issue and therefore cannot be construed to imply 

consent. 

D. Prejudice 

 While a lack of consent constitutes sufficient grounds 

for denying amendment, see In re Rauh, 119 F.3d at 52 ("A posttrial motion to conform the judgment to the evidence should not be 

allowed . . . unless the opposing party expressly or impliedly 

agreed to try the matter in question."), there remains another 

reason why the bankruptcy court's judgment allowing the motion to 

amend must be reversed. Patriot's request to amend its pleadings 

was first noted two months after trial in its post-trial brief, 

and a formal Motion to Conform the Pleadings to the Evidence was 

not filed until almost three months after the trial's conclusion. 

"We think that prejudice is an almost inevitable concomitant in 

situations where, as here, the late amendment attempts to 

superimpose a new (untried) theory on evidence introduced for other 

purposes." DCPB, 957 F.2d at 917 (citing Grand Light & Supply 

Co., Inc. v. Honeywell, Inc., 771 F.2d 672, 680 (2d Cir. 1985)). 

When considering the prejudice to the non-moving party, the 

appellate court may consider "whether the movant has shown any 
-27- 

justification for its delay in moving to amend." Id. at 917-18 

(finding prejudice where motion to amend was not based on new facts 

or a newly decided case); see also Campana, 755 F.2d at 216 

(finding no justification for the delay in moving to amend where 

motion to amend was made in response to a jury question). 

Here, Patriot's justification for its delay is not based 

on any newly discovered facts or changes in the law. While the 

bankruptcy court imputed the knowledge of a possible § 727(a)(6) 

claim on Fustolo as early as the March 17, 2016, Patriot too must 

be held to the same standard of foreseeability in this analysis. 

We do not intend to imply that a plaintiff must move to amend 

immediately after the non-movant is put on notice of a new claim; 

for that matter, Rule 15(b)(2) explicitly contemplates that a 

motion to amend can occur "even after judgment," which, by its 

nature, occurs after the non-moving party had notice of the new 

claim through evidence introduced at trial. Nonetheless, a moving 

party must provide a sufficient justification to excuse its delay. 

See DCPB, 957 F.2d at 917-18; Campana, 755 F.2d at 216. 

Furthermore, "[k]nowledge heightens the need for prompt 

action." DCPB, 957 F.2d at 918. Before this court, Patriot 

proffers that it did not move to amend its complaint between March 

17, 2016, and the commencement of trial because it did not want to 

give Fustolo an opportunity to seek further delay. But, a desire 
-28- 

to avoid a trial delay cannot justify precluding the opposing party 

an opportunity to react to the new claim cannot justify a delay in 

moving to amend. Moreover, as noted in one of the bankruptcy 

court's orders that Patriot included in its request for judicial 

notice, the court had set an expeditious trial date as a sanction 

for Fustolo's violation of the December 31 Order, militating the 

concern of future substantial delays. Between the March 17, 2016 

sanctions hearing and the beginning of trial, the bankruptcy court 

denied Fustolo's motion to continue trial on March 24, 2016, 

Fustolo's motion for reconsideration of that denial on April 8, 

2016, and Fustolo's motion to continue a hearing on May 16, 2016, 

Patriot's justification, a confession of sandbagging, is 

unpersuasive in light of the March 17, 2016 sanction imposed. 

Patriot further states that it was "busy finishing 

discovery . . . [and] preparing for trial," as a reason for the 

delayed motion to amend, and notes both parties' counsel's 

previously scheduled vacations in relation to its delayed posttrial filing. But, Patriot's busyness cannot justify the 

injection at the eleventh hour of a new theory of discharge denial 

based on previously-available facts -- Fustolo's failure to comply 

with the bankruptcy court's December 31 Order. See DCPB, 957 F.2d 

at 918; see also Stonkus v. City of Brockton Sch. Dep't, 322 F.3d 

97, 101 (1st Cir. 2003) ("Most attorneys are busy most of the time 
-29- 

and they must organize their work so as to be able to meet the 

time requirements of matters they are handling or suffer the 

consequences."). 

Because we find that Fustolo did not have fair notice of 

the unpleaded claim and was prejudiced by its addition, we hold 

that the bankruptcy court's allowance of Patriot's motion to 

conform its pleadings under Fed. R. Civ. P. 15(b)(2) was an abuse 

of discretion. Finding the bankruptcy court's allowance of 

Patriot's motion to amend improper, we need not reach the merits 

of Fustolo's claim that § 727(a)(6) does not apply to his assertion 

of his Fifth Amendment right against self-incrimination. 

III. CONCLUSION 

"The truth-seeking function of our adversarial system of 

justice is disserved when the boundaries of a suit remain illdefined and litigants are exposed to the vicissitudes of trial by 

ambush." Doral Mortg., 57 F.3d at 1172. Here, for the reasons 

stated above, Fustolo did not receive adequate notice of an 

unpleaded claim, and did not provide his implied consent. We 

therefore REVERSE the bankruptcy court's order and REMAND for 

further proceedings consistent with this opinion. We take no 

position as to the merits of any remaining claims and leave such 

further analysis to the bankruptcy court.