August 17, 2021
Third Circuit Rejects Triangular Setoffs as Not Satisfying Mutuality Requirement of § 553 of the Bankruptcy Code
EDITOR’S NOTE: In this article from the American Bankruptcy Institute’s Unsecured Trade Creditors Committee Newsletter, Tim Brink discusses the Third Circuit’s decision holding that “triangular” setoffs are not permissible in bankruptcy and rejecting the argument that parties can contract around the requirement of strict bilateral neutrality. In its recent decision in In re Orexigen Therapeutics…