His first readback WAS correct:
ATC: Husky 9 hotel uniform, hold short runway 25 ... at Hotel.
Ford: Hold short of 25 at Hotel for 89HU
Ford: 89HU holding short at Hotel
So far, so good. The next thing a pilot would normally expect to hear would a clearance to cross the runway, so expectation bias probably played a role here:
ATC: 9HU continue hold short of runway 25, traffic on the runway. (beginning of this is a tad garbled)
Ford: crossing 25, 89HU
ATC: 9HU get across that runway now. I told you to hold short. You need to listen up.
Ford: Excuse me, sir, I thought exactly the opposite. I'm sorry.
Pure speculation on my part, but it's possible 9HU was still moving up to the hold-short line when he called and said he was holding short. Tower started the next transmission with the word "continue", and so he did exactly what he was expecting to do - continue across the runway - and his readback confirmed that. I suspect there will be some debate about the wisdom of starting a hold-short instruction with the word "continue", but that will be left to the FAA and others to hash out. He did say "traffic on the runway" so that should have been a clue to stay put.