The Bankruptcy Code provides debtors with the opportunity for a fresh start in the face of mounting financial obligations. The Code also provides for fair and equitable treatment of creditors.
Don't Set Me Off: No Triangular Setoff Among Affiliated Entities and a Debtor Counterparty
In today's global economy, companies often have multiple business lines operating through separate entities. Outside of bankruptcy, these affiliated operations sometimes transact in a holistic — albeit legally distinct — debtor-creditor relationship with their counterparty. But, as this article discusses, the legal separateness of affiliates can hinder economic protections that a creditor might have otherwise when its counterparty files for bankruptcy.
By
Adam C. Rogoff
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