SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* HIGHLAND CAPITAL MANAGEMENT LP (Last) (First) (Middle) 13455 NOEL ROAD SUITE 800 (Street) DALLAS TX 75240 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol Highland Distressed Opportunities, Inc. [ HCD ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director 10% Owner Officer (give title below) X Other (specify below) Investment Adviser
	3. Date of Earliest Transaction (Month/Day/Year) 04/01/2008
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Shares par value $0.001 per share	04/01/2008		P		10,000	A	$7.1187	882,125.17(1)(2)	D(3)(4)
Common Shares par value $0.001 per share	04/02/2008		P		21,962	A	$7.6364	904,087.17(1)(2)	D(3)(4)

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares

1. Name and Address of Reporting Person* HIGHLAND CAPITAL MANAGEMENT LP (Last) (First) (Middle) 13455 NOEL ROAD SUITE 800 (Street) DALLAS TX 75240 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director 10% Owner Officer (give title below) X Other (specify below) Investment Adviser

1. Name and Address of Reporting Person* DONDERO JAMES D (Last) (First) (Middle) 13455 NOEL ROAD SUITE 800 (Street) DALLAS TX 75240 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director 10% Owner X Officer (give title below) Other (specify below) President

Explanation of Responses:

1. This statement is filed by and on behalf of each of the following persons (collectively, the "Reporting Persons"): Highland Capital Management, L.P. ("Highland Capital") and James D. Dondero ("Dondero").

2. Mr. Dondero is the President and a director of Strand Advisors, Inc. ("Strand"), the general partner of Highland Capital; he may be deemed to beneficially own shares owned and/or held by and/or for the account of and/or for the benefit of Strand and/or Highland Capital.

3. Each of the Reporting Persons declares that neither the filing of this statement nor anything herein shall be construed as an admission that such person is, for the purposes of Section 13(d) or 13(g) of the Act or any other purpose, the beneficial owner of any securities covered by this statement.

4. Each of the Reporting Persons may be deemed to be a member of a group with respect to the issuer or securities of the issuer for the purposes of Section 13(d) or 13(g) of the Act. Each of the Reporting Persons declares that neither the filing of this statement nor anything herein shall be construed as an admission that such person is, for the purposes of Section 13(d) or 13(g) of the Act or any other purpose, (i) acting (or has agreed or is agreeing to act together with any other person) as a partnership, limited partnership, syndicate, or other group for the purpose of acquiring, holding, or disposing of securities of the issuer or otherwise with respect to the issuer or any securities of the issuer or (ii) a member of any group with respect to the issuer or any securities of the issuer.

Remarks:

Highland Capital may be deemed a director by virtue of the service of Raymond Joseph Dougherty, a limited partner of Highland Capital, on the board of directors of the issuer.

	Highland Capital Management, L.P. By: Strand Advisors, Inc., its general partner /s/ James D. Dondero, President	04/02/2008
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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