Convicted: Highlawn fails to pay taxes

Local owners of Highlawn Pavilion were convicted last Wednesday in Rockingham County Circuit Court for failure to pay state sales and city meals taxes.

Brenda and Nick Neofitis were found guilty of embezzlement in Virginia’s first felony conviction for failure to pay sales tax. Sentencing is scheduled for April 1 and each could be sentenced to up to 20 years in prison or up to a $2,500 fine.

The conviction covers crimes committed from January 2002 until March 2004, which totalled $108,000.
Gene Hart, the attorney for Nick Neofitis, said that his client already has plans to appeal. Hart also said that this was the first time the embezzlement statue had been used in such a case.

"This is certainly a case that will be appealed," Hart said. He said this is a tax case and not an embezzlement issue. Although the Commonwealth proved Highlawn Pavilion, LLC, the company that owns Highlawn Pavilion, failed to pay taxes in a timely manner, Hart said Nick Neofitis has done nothing wrong.

"The Commonwealth allegations were against Nick and Brenda, but it hadn’t proved they had taken the money for their personal use," Hart said.

He said Highlawn Pavilion also is owned by LLC, but only the Neofitises were brought to court for the charges.

Since the bar is owned by a "mix of corporation and partnership," according to Hart, Nick Neofitis should not have been brought to court personally.

Hart also said that at the time of the trial, the taxes had already been paid.

Bruce Albertson, the lawyer for Brenda Neofitis, said that he had no comment on the case while it was still pending.

Commonwealth prosecutor Phillip Figura could not be reached for comment.

Highlawn Pavilion also is facing charges by from the Virginia Alcohol Beverage Control. According to Whitney Miller, public relations specialist, ABC is proceeding with administrative charges.

However, at this time, the case has not been scheduled for a hearing before an ABC panel, Miller said.