Elizabeth Holmes Denied Bail and Faces 11-Year Sentence as Appeals Continue
In a recent one-page order, the U.S. Court of Appeals for the 9th Circuit rejected the motion by Elizabeth Holmes, the convicted founder, and CEO of Theranos, to remain out of prison while she appeals her conviction for wire fraud.
The court determined that Holmes had not presented a “substantial question” regarding the fairness of her trial or provided evidence that any trial errors would likely lead to a reversal or a reduced sentence from the 11-year, three-month prison term imposed by U.S. District Judge Edward Davila.
Holmes was found guilty by a jury in January 2022 of deceiving and defrauding investors about the capabilities of Theranos’ blood-testing technology.
Although Davila initially ordered Holmes to surrender to federal prison authorities on April 27, the implementation of the order was temporarily suspended pending the higher court’s decision on her bail request.
Now that her request has been denied, it will be up to Davila to determine a new surrender date for Holmes. Meanwhile, her appeal will proceed as scheduled and is expected to take several months or even a year to reach a resolution, according to the 9th Circuit’s order.
Davila had recommended that Holmes serve her sentence at a women’s prison in Bryan, Texas, but it remains undisclosed whether the federal Bureau of Prisons has accepted this recommendation or assigned her to another facility.
In a late Tuesday ruling, U.S. District Judge Edward Davila ordered Elizabeth Holmes, the former Theranos founder, to pay $452 million in restitution to the victims affected by her fraudulent activities.
Holmes shares joint liability for this amount with her former partner and top Theranos executive, Ramesh “Sunny” Balwani, who is already serving a prison sentence for his convictions in a separate trial involving a broader range of felonies.
Davila’s restitution ruling identified media mogul Rupert Murdoch as the recipient of the largest share, amounting to $125 million, among the listed investors.
The restitution also mandates that the co-conspirators in the Theranos scheme pay $40 million to Walgreens, which became an investor in the company and agreed to offer the flawed blood tests in its pharmacies in 2013.
An additional $14.5 million is owed to Safeway, which had initially partnered with Theranos but later withdrew.
During separate hearings, the lawyers representing Holmes and Balwani argued that their clients should be required to pay minimal amounts or even nothing at all. Prosecutors had sought a restitution penalty in the range of $800 million.
Both Holmes, who previously held a stake in Theranos valued at $4.5 billion, and Balwani, whose holdings were once valued at approximately $500 million, have indicated financial hardships due to mounting legal fees and claim to be nearly broke.