Law360, New York (May 4, 2015, 12:02 PM EDT) -- There are numerous issues to be taken into consideration regarding contracts establishing setoff rights in the context of a bankruptcy filing. The main concern is that the contract providing for the setoff rights must be drafted in such a way so as to be enforceable in bankruptcy in order to avoid a situation where a creditor is anticipating payment in full due to setoff rights and then ultimately receiving only an unsecured claim. The primary reason why such a setoff right would not be enforceable in bankruptcy is that the court could decline to recognize mutuality when the contract providing for the setoff right involves multiple related entities such as, for example, in the case of a master netting agreement....