While playing a game tonight, my opponent daisy chained the Defender ability.

Defender Team Ability: Before any attack roll, a character using the Defenders team ability can for the attack replace its defense value with the unmodified defense value (including a replacement defense value) of any adjacent friendly character possessing the Defenders team ability.

My opponent had Groot, Starlord, and then Bug in a line, and when Iron Fist attempted to hit Bug, I was told Bug had a defense of 20 (Groot's defense of 18 plus Bug's combat reflexes).

It looked like this:
XXGXX
XXSXX
XXBXX
XXXIX

Did we play this right? Or could Bug only gain Starlord's defense? Thanks in advance.

All good, man, all good.

How exactly does that work? Per the team ability, when attacked, a model may use the defense of an adjacent character. Groot wasn't adjacent, and Starlord wasn't attacked, so Starlord wouldn't gain Groot's defense to pass on to Bug?

I'm not questioning your response, I'm just confused as to what allows that to work, so I can apply the answer to other powers and abilities. Thanks again.

It doesn't specify who has to be attacked. If an attack is happening to anyone, they can share.

Because starlord replaced his DV with groot's and bug replaced his with starlord replaced DV.

Daisy-chaining also works for SynSin and Bat Enemies. Bring 1 guy with a high AV, sit him in back, & have fun.

Awesome, that makes a lot of sense now. Thanks to everyone for the help.