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Litton decided to purchase photocopiers to use in its offices. Angelo Buquicchio, a Royal (a division of Litton) salesman, recommended that Litton lease the machines from Regent. Regent was a company totally independent of Litton and had agreed to give Buquicchio ‘‘service fees'' or, more appropriately, bribes. Regent borrowed money from Bankers Trust to finance purchases and transferred the Litton leases as security. A clause in the leases permitted transfer and provided that the transferee's rights would be independent of any claims or offsets of Litton as against Regent.
Litton defaulted on the obligations, and Litton argues that Regent's bribery of Royal's employee rendered Litton's obligations a nullity and a defense against the banks as holders in due course. Explain whether Litton is correct in its assertion.
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