Chicago’s Judge David Cleary called for post-confirmation arbitration of claims between the debtor and a creditor, but no arbitration for the creditor’s defenses, raising questions of bankruptcy law.
Medicaid overpayments may be recovered as ‘recoupment’ while Social Security overpayments are attempted setoffs barred by discharge, Bankruptcy Judge Harwood says.
The Madoff case makes more law: A claim against a bankrupt estate can’t be set off against liability for receipt of a fraudulent transfer because one arose before bankruptcy and the other arose after.
