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Elizabeth Holmes seeks to avoid prison for Theranos fraud

Randy Mancini 5 November 11, 2022

By Jonathan Stempel and Jody Godoy

(Reuters) – Elizabeth Holmes urged a U.S. judge not to send her to prison, as the founder of Theranos Inc prepares to be sentenced next week for defrauding investors in the blood testing start-up.

In a Thursday night court filing, lawyers for Holmes asked that she receive 18 months in home confinement, followed by community service, at her Nov. 18 sentencing before U.S. District Judge Edward Davila in San Jose, California.

The lawyers said prison time was unnecessary to deter future wrongdoing, calling the 38-year-old Holmes a “singular human with much to give” and not the robotic, emotionless “caricature” seen by the public and media.

“No defendant should be made a martyr to public passion,” the lawyers wrote. “We ask that the court consider, as it must, the real person, the real company and the complex circumstances surrounding the offense.”

Prosecutors are expected to file their sentencing recommendation soon.

A jury convicted Holmes in January on four counts of wire fraud and conspiracy. Each count carries a maximum 20-year prison term. Any sentence would likely be served concurrently.

Prosecutors said Holmes lied to investors from 2010 to 2015 by promising Theranos’ technology could run many tests on one drop of blood from a finger prick.

On Monday, Davila rejected Holmes’ requests for a new trial, including over a claim that a key prosecution witness visited her at home and made statements that undermined his testimony.

Holmes founded Theranos in 2003 at age 19, before dropping out of Stanford University. Theranos was once valued at $9 billion, and Forbes magazine in 2015 estimated Holmes’ net worth at $4.5 billion.

More than 130 friends, family, investors and former Theranos employees submitted letters to Davila urging leniency for Holmes.

Her partner Billy Evans called Holmes, known as Liz, “honest, humble, selfless, and kind beyond what most people have ever experienced.”

Theranos’ former president Ramesh “Sunny” Balwani was convicted in July of defrauding investors and patients about the company. His sentencing is scheduled for Dec. 7.

(Reporting by Jonathan Stempel and Jody Godoy in New York; editing by Diane Craft)