Law360, New York (June 08, 2012, 3:52 PM ET) -- On May 14, 2012, the Third Circuit Court of Appeals in In re Heritage Highgate Inc., et al., No. 11-1889 (3d Cir. May 14, 2012) clarified the burden of proof with respect to the valuation and ultimate allowance of alleged secured claims under Bankruptcy Code section 506(a).
In clarifying this burden, the Third Circuit held that a burden-shifting approach applies under Section 506(a), requiring the debtor to first overcome the presumed validity and amount of the creditor’s secured claim, with the creditor bearing the ultimate burden...
Case Study: In Re Heritage Highgate
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