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Elizabeth Holmes Ordered To Pay $452 Million, Loses Bid To Delay Prison Sentence
She and former lover Ramesh "Sunny" Balwani are both responsible for paying the sum to victims of their Theranos fraud.
An appeals court has rejected disgraced Theranos CEO Elizabeth Holmes' latest bid to avoid prison time.
In a decision handed down on Tuesday, the Ninth Circuit Court of Appeals in San Francisco ruled that Holmes must report to prison while she appeals her wire fraud convictions, according to NPR. This was in response to Holmes' attorneys' April 26 filing in which they appealed District Judge Edward Davila's decision that Holmes turn herself in on April 27th.
Meanwhile, Judge Davila stated in a separate ruling issued on Tuesday that Holmes and former Theranos COO Ramesh “Sunny” Balwani, with whom she was previously romantically involved, pay about $452 million in restitution to victims of their fraud involving the blood-testing company Theranos, according to NPR. An estimated $125 million will go to media mogul Rupert Murdoch, one of the many high-profile figures who invested in Theranos.
Following Holmes' January 2022 conviction on three counts of wire fraud and one count of conspiracy to commit wire fraud, she was sentenced to 135 months in prison and three years of supervised release. Since then, she has repeatedly sought to delay her prison sentence since the sentencing hearing in which she apologized to investigators.
"I am devastated by my failings. Every day for the past years I have felt deep pain for what people went through because I failed them," she told the court at the time.
In the latest bid, her attorneys filed a last-minute appeal of Judge Davila's decision, which automatically allowed Holmes to remain free on bail while the Ninth Circuit Court made their decision.
Previously, her defense team requested that her sentence be delayed on account of her giving birth to her second child, a baby girl named Invicta whom she shares with partner William "Billy" Evans. Davila denied this request in mid-April.
A new date for Holmes to surrender will be set by Davila in the coming weeks. Davila previously recommended she be incarcerated at the Federal Prison Camp, Bryan in Texas.
For his part, Balwani reported to prison on April 20 after being convicted on 12 felony counts of defrauding Theranos investors and the company's patients in a separate trial. He was sentenced to 13 years.
The duo's convictions stem from the startup's claims that Holmes invented a machine, called the Edison, which could perform dozens of tests using minimal amounts of blood. However, prosecutors showed that the technology did not work as suggested, with Theranos instead relying on third-party technology to conduct the tests.
Holmes' claims of success were at the center of her pitch to investors who gave the company an estimated $945 million before a Wall Street Journal report revealed inconsistencies in Theranos' reported studies. As a result, the company's value, which was valued at $10 billion at its peak, plummeted.
