A civil defendant is not without recourse to protect against an unfavorable inference from a Fifth Amendment assertion. A defendant who is the target of an active criminal investigation may request a stay of the civil litigation pending resolution of the criminal proceedings. The courts have enunciated several factors to consider when deciding whether to issue a stay. These factors include the extent to which the issues in the civil and criminal cases overlap; the status of the criminal case, especially whether the defendant has been indicted; the private interests of the plaintiff in proceeding expeditiously weighed against the harm to the plaintiff caused by the delay; the private interests of and burden to the defendants; the interests of the court; and the public interest. See In re CFS-Related Sec. Fraud Litig., 256 F. Supp. 2d 1227, 1236-37 (N.D. Okla. 2003); Volmar Dist., Inc. v. New York Post Co., 152 F.R.D. 36, 39 (S.D.N.Y. 1993); see also Pendergest-Holt v. Certain Underwriters at Lloyd’s of London, Civil Action No. H-09-3712, 2010 WL 3199355, at *3 (S.D. Tex. Aug. 11, 2010) (denying motion to stay filed by plaintiffs who asserted Fifth Amendment right because stay would unduly burden opposing parties). The two most important factors are the overlap between the civil and criminal matters and whether an indictment has been issued in the parallel criminal proceeding. Although courts have issued stays of civil proceedings absent an indictment, as a practical matter, obtaining a stay will be difficult unless an indictment has been issued and a criminal case is underway. See Dresser Indus., Inc., 628 F.2d at 1377 (declining to block SEC investigation due to parallel grand jury proceedings); Sterling Nat. Bank v. A-1 Hotels Intern., Inc., 175 F. Supp. 2d 573 (S.D.N.Y. 2001), (noting that courts of 2nd Circuit generally consider stay only after defendant has been indicted); but see Wehling v. Columbia Broadcasting Sys., 608 F.2d 1084, 1089 (5th Cir. 1979) (affirming three-year stay where party threatened with prosecution); Chao v. Fleming, 498 F. Supp. 2d 1034, 1039–40 (W.D. Mich. 2007) (granting stay when no indictment had yet been issued); SEC v. Healthsouth Corp., 261 F. Supp. 2d 1298, 1327 (N.D. Ala. 2003) (same).
What if some, but not all, of the defendants invoke their Fifth Amendment rights? The grounds for a stay may be stronger when the rights of non-target defendants are at risk. The non-targets, like the plaintiff, are precluded from obtaining testimony from potentially key witnesses. The unavailability of codefendants’ testimony, coupled with potential prejudice at trial to the testifying defendants, provide stronger grounds for issuing a stay in such circumstance. See In re Adelphia Comm. Sec. Litig., No. 02-1781, 2003 WL 22358819, at *5 (E.D. Pa. May 13, 2003) (citing prejudice to testifying defendants as factor in granting motion to stay).