%1

Setoff is a valuable state law remedy for trade creditors with a claim against, and an obligation owing to, an insolvent customer. The right of setoff allows a creditor to “net” or cancel mutual debts to avoid having to pay its debt to a debtor in full while standing in line to recover its claim against the debtor. “Triangular setoff” is a contractual right of setoff that permits one party to net and set off contractual claims of its affiliated entities against another party.

Bankruptcy Judge Brendan L. Shannon recently confirmed the chapter 11 plan of RMH Franchise Holdings, Inc. and its affiliated debtors, notwithstanding that the plan proposed significantly better treatment for unsecured trade creditors than for other general unsecured creditors. RMH was formed in 2012 and, prior to its bankruptcy, had become the second-largest franchisee for Applebee’s restaurants in the U.S., according to its filings.

With apologies to Twain and Disreali,[1] the title quote may come to mind when, in response to a defense letter outlining an ordinary course of business (OCB) defense comparing consistent and without-undue-collection-effort billing and payment practices in the “preference period”[2] with the period prior thereto (the “historical period”), the plaintiff responds with an OCB position based on a “standard deviation” analysis.

The U.S. District Court for Eastern District of Louisiana recently affirmed the U.S.

Most oil and gas-producing states have oil and gas mineral lien statutes (similar to what many lawyers know as mechanic’s and materialman’s lien statutes) that grant automatically arising liens in favor of vendors that provide services in connection with oil and gas well operations. Louisiana’s version of the statute is known as the Louisiana Oil Well Lien Act (LOWLA).[1] On June 14, 2018, in a case of first impression, the U.S.

[1]“Critical vendor” status is a blessing. Without such status, an unsecured creditor may receive little to no recovery in a traditional chapter 11. Thus, critical vendor status instills hope in unsecured creditors, and when courts — particularly the Supreme Court — reference the revered status, members of the legal community listen and take note.[2]