“/>Picture credits: Justin Sullivan/Getty Images
After years of high-profile legal proceedings, Elizabeth Holmes may actually be heading to jail. For real this time.
The former Theranos founder and CEO was convicted of defrauding investors last January, but has consistently delayed and appealed his conviction to avoid jail time. Although the infamous biotech entrepreneur is still appealing her 11-year sentence, a panel of Ninth Circuit judges has ruled that Holmes’ legal team failed to raise enough ‘substantial issues’ to keep her out of harm’s way. prison. So unless Holmes has even more tricks up her sleeve, she will soon begin serving her prison sentence, five years after Theranos disbanded. Holmes had already been ordered to report to jail on April 27. Her former boyfriend and Theranos COO Ramesh “Sunny” Balwani, who was convicted of defrauding investors and patients, reported to jail last month.
But the bad news keeps pouring in for Holmes and Balwani. The two former Theranos executives were ordered to pay $452 million in compensation to the victims of their fraud, for which they are jointly and severally liable.
Picture credits: United States District Court, Northern District of California (Opens in a new window)
Business tycoon Rupert Murdoch will receive the biggest payout of $125 million. Walgreens and Safeway, which have entered into agreements with Theranos to use its technology in their stores, will receive $40 million and $14.5 million, respectively. The DeVos family company, RDV Corp, will receive a $100 million payment. Several other investors getting restitution include Black Diamond Ventures, Peer Ventures Group, PFM Funds and others.
Just last week, the New York Times published a long, controversial profile of Holmes, which portrays her through a perhaps too sympathetic lens: Now known as “Liz,” the convicted fraudster is portrayed as a loving mother, a volunteer for a rape. crisis hotline and survivor of alleged abuse by Balwani, her former partner. These aspects of his identity are apparently true. But what’s also true is that Holmes ran a company that raised $10 billion worth of investment for technology that didn’t actually exist.
These actions have had real consequences for ordinary, innocent people. In one case, a mother with a history of miscarriage was wrongly told that she would not be able to deliver her baby. Another patient, Erin Tompkins, used Theranos blood tests to save money, was reported HIV-positive, and had to wait three months before she could afford a second blood test. She didn’t actually have HIV. Another patient, Mehrl Ellsworth, was falsely diagnosed with cancer after using Theranos tests.
Ellsworth and Tompkins testified in the cases against Balwani and Holmes. But the jury in the Balwani case found him guilty of defrauding patients and investors, while Holmes was only found guilty of defrauding investors.
The future does not look bright for Holmes. But his new date of surrender has not yet been set.