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Former Theranos CEO Elizabeth Holmes set to be sentenced

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Former Theranos CEO Elizabeth Holmes is awaiting sentencing on Friday, 10 months after the verdict. the jury found her guilty deceiving investors in a failed blood-testing company.

Sentencing hearings in San Jose, Calif. began just after 10 a.m. Pacific time and were progressing as the clock approached noon.

Holmes, 38, founded Theranos in 2003 and quickly grew it into one of the world’s most recognizable startups, peaking at a $10 billion valuation. However, a series of revelations by the Wall Street Journal raised questions about the effectiveness of the company’s technology and business practices, leading to multiple investigations by federal and state officials.

The ruling, handed down by Judge Edward Davila of the Northern District of California, shows how serious offenders can expect to be punished for misrepresenting a company’s capabilities in the booming world of tech startups. be considered.

“We want the public to know that if you defraud investors or anyone else, especially in highly publicized cases, you are considering a serious jail sentence,” said Investigative and White Collar Defense Global Co-Chair Carrie Cohen said. Practice group of law firm Morrison Foerster.

“Given the fact that the trial all came out clear, I suspect she’s looking at a sizeable amount of jail time, probably closer to what the government asked for,” Cohen said.

In January, Holmes was found guilty of four counts. Investor Fraud and ConspiracyA jury acquitted her of four other counts of using a Theranos blood-testing device to harm a patient, but disagreed on other charges. Her Theranos investors, a group that includes media mogul Rupert Murdoch and software billionaire Larry Ellison, lost her $144 million when the startup failed.

Federal prosecutors called Holmes’ crime “one of the most serious white-collar crimes Silicon Valley or any other district has seen,” calling for a 15-year sentence and an $800 million payout. Documents to submit to the court this week.

Theranos Founder Elizabeth Holmes Attends Court Hearing
Theranos founder Elizabeth Holmes (right) leaves federal court in San Jose, California on Thursday, September 1, 2022.

bloomberg


Holmes’ attorney argued that she poses no danger to society, has debts that she probably cannot repay, and is already suffering from “inhumanely cruel” media coverage of Theranos’ downfall, arguing that she They presented testimony from 130 people, including friends, family members, and even Senator Cory Booker, proving Holmes’ excellent care.

Holmes has a one-year-old son and appeared pregnant at a recent court hearing. Both could be factors in judges’ leniency in sentencing, Cohen said.

Holmes testified that he was raped and traumatized during college, and that he was sexually and emotionally abused by former Theranos chief operating officer Sunny Balwani, who is 19 years his senior. Holmes said that Balwani controlled her schedule, meals, and presentations to others, and frequently belittled and criticized her.

Balwani’s attorneys deny the allegations.he was convicted 12 cases of fraud A ruling was handed down in July and a ruling is expected on December 7.

Holmes said she plans to appeal her conviction. A judge can delay the start of her term until Holmes gives birth, and while she appeals her sentence, she can also post bail to keep her out of jail, Cohen said. said.

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