A federal judge has granted a stay in the civil proceedings against brothers Shane and Sean Hvizdzak, over the objection of the Securities and Exchange Commission.
In June of 2020, the SEC filed a complaint against Shane Hvizdzak, 32, of Bradford, and his brother Sean, 34, of St. Marys, along with a company the two co-owned, High Street Capital. The complaint alleged the two took money from investors, said it was being invested in digital assets and fabricated statements saying the investments were earning huge returns. However, the SEC alleged the brothers took about $31 million from investors, put it in their personal accounts and then moved it outside the United States.
Sean Hvizdzak has maintained his innocence, while Shane Hvizdzak has claimed his Fifth Amendment right against self incrimination.
Shane Hvizdzak’s attorney had requested a stay in the proceedings, saying a criminal case involving the same allegations was imminent. A deposition given in the civil case would have a detrimental impact on his Fifth Amendment rights in the criminal case
On June 23, Sean Hzivdzak filed a joinder in request of a stay in the case, but noted his request was for a different reason than his brother’s. He alleged that testimony and documents from his brother are necessary to show his innocence in the matter, but his brother has invoked his Fifth Amendment rights, thereby depriving Sean Hvizdzak of information critical to his defense.
Sean Hvizdzak had asked the court to postpone the civil matter until the criminal matter was complete. “At that point, Shane Hvizdzak will no longer have any relevant Fifth Amendment rights,” the motion read, “and Sean Hvizdzak’s efforts to defend himself will no longer be detrimentally inhibited or unfairly limited.”
However, the SEC argued against any postponement, saying that at this time, any reference to criminal allegations are merely a suspicion. The process of fact discovery in the case is nearly completed, and the case is “on track for a determination as to liability and potential relief to harmed investors.” Granting a stay now would delay resolution and the return of assets, the SEC argued.
They argued, too, that Sean Hvizdzak’s argument isn’t valid, alleging substantial evidence exists to implicate him in the alleged matters.
The judge, W. Scott Hardy in Erie, ordered a stay in the matter until Aug. 13. He also ordered oral arguments from the parties to be held by video teleconference on July 21.
