Theranos Founder Finally Gets Her Due With 11-Year Sentence

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Theranos Founder Finally Gets Her Due With 11-Year Sentence

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Elizabeth Holmes was found guilty earlier this year over her role in a massive fraud at the blood-testing startup.

Noah Kirsch

Wealth And Power Reporter

Updated Nov. 18, 2022 5:42PM ET / Published Nov. 18, 2022 5:17PM ET 

Listen to article5 minutes

Four years and two pregnancies since she was indicted for her role in perpetrating a massive fraud, Theranos founder Elizabeth Holmes arrived in court on Friday to finally learn her fate. When it was her turn to address the judge, she invoked the poet Rumi and apologized through tears. “I regret my failings with every cell of my body,” she said.

The belated act of contrition seemed not to help.Judge Edward Davila of the U.S. District Court for the Northern District of California sentenced her to 11.25 years of prison time, followed by three years of supervised release. A separate hearing will be held regarding restitution. Holmes is scheduled to begin her sentence in April.

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In January, the 38-year-old Stanford dropout was convicted on four counts related to her work at the blood-testing startup; she faced up to 20 years in prison.

The sentencing capped off a stunning downfall for Holmes, who once graced magazine covers and amassed a $4.5 billion fortune. As she heads off to prison, Holmes will leave behind a son she had with hotel heir Billy Evans in July 2021; during a court appearance last month, she was visibly pregnant with her second child.

Sunny Balwani, Theranos’ former chief operating officer and Holmes’ one-time lover, is scheduled to be sentenced next month. He was convicted of 12 charges in July.

Originally, Holmes and Balwani had been slated to be tried together, but their trials were later separated. Holmes had pinned much of the blame for Theranos’ demise on Balwani and claimed he had abused her during their relationship.

In her pre-trial memos, Holmes claimed that Balwani “controlled what she ate, how she dressed, how much money she could spend, [and] who she could interact with,” in effect “erasing her capacity to make decisions” while she served as Theranos’ CEO.

During the trial, she further alleged that Balwani’s pattern of abuse included forcing her to have sex with him. “He told me that I didn’t know what I was doing in business, that my convictions were wrong, that he was astonished at my mediocrity,” she said.

Balwani has denied many of the allegations.

Holmes had faced 11 counts of wire fraud or conspiracy to commit wire fraud. Prosecutors alleged that Holmes and Balwani presided over a culture of intense secrecy, fear, and retribution at Theranos, which they used to obscure its technological failures.

Some patients claimed they received incorrect results from Theranos devices, while investors alleged that Holmes and Balwani misrepresented the company’s prospects.

Former Theranos lab director Adam Rosendorff testified during the trial that the startup jury-rigged other companies’ blood testing machines while suggesting that it had made breakthroughs of its own. He added that Theranos took its machines to market prematurely.

“I came to believe the company cares more about PR and fundraising than it cares about patient care,” he said. (After Holmes was convicted, Rosendorff visited her residence to reportedly express dismay about her possible future behind bars; Holmes’ attorneys tried to depict the surprise visit as Rosendorff apologizing for supposedly false testimony. They unsuccessfully appealed for a new trial on that basis.)

Holmes’ lawyers insisted during the trial that their client genuinely believed in her work. “Elizabeth Holmes did not go to work every day intending to lie, cheat and steal,” said one of those attorneys, Lance Wade.

After seven days of deliberating, the jury convicted Holmes on four counts related to defrauding investors, acquitted her on the counts related to defrauding patients, and deadlocked on the final three counts.

Even after her conviction, she received support from those who believed she was unfairly victimized, and from other unexpected sources. New Jersey Senator Cory Booker, for instance, was one of 130 people who submitted a letter on her behalf to Judge Davila.

“I firmly believe in the possibility of rehabilitation and in the power of redemption for anyone. And I believe that Ms. Holmes has within her a sincere desire to help others, to be of meaningful service, and possesses the capacity to redeem herself,” wrote the senator, adding that he and Holmes had previously been friends.

Prosecutors pushed for a fifteen-year sentence. In Friday’s hearing, they assailed Holmes’ allegedly brazen misconduct, claiming she once pompously asserted, “They don’t put attractive people like me in jail.”

Based on his sentencing, the judge clearly believes Holmes has a ways to go before she is rehabilitated.

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