Law360, New York (November 5, 2014, 10:50 AM EST) -- In a familiar scene for claims traders in U.S. Chapter 11s, the German Supreme Court (Bundesgerichtshof, hereinafter, "BGH"),[1] in a string of recent decisions, has held that disabilities and defenses to a claim generally "travel with it" when it is transferred to a third-party purchaser. In doing so, the court has begun to align itself with prevailing practice in the U.S. in the wake of the Third Circuit's recent decision in KB Toys. In future, funds active in the German distressed debt market will need to tread carefully to ensure the validity of their claims, especially in light of the German bankruptcy regime's harsh treatment of shareholder loans and related transactions....