U.S. bankruptcy law gives courts great latitude to reverse transactions involving the property of a bankrupt entity, because a lot of abuse of the bankruptcy system is possible otherwise.

The problem here is actually with VeriSign. Any time you transfer an asset to an entity but retain the right to get it back under certain conditions, you have to think through what will happen if that other party enters into bankruptcy and those assets get sucked into the proceeding. It's wrong for them to assume they can resell the domain name the second it lapses.