The Third Circuit in In re KB Toys, Inc.1 recently affirmed a decision of the Delaware District Court, holding that trade claims are subject to disallowance under section 502(d) of the Bankruptcy Code despite their subsequent sale to a third party. This case is of particular interest to investors in distressed debt.
USA, Delaware, Insolvency & Restructuring, Litigation, Morrison & Foerster LLP, Liquidation, ING Group, Third Circuit