Elizabeth Holmes loses latest bid to avoid prison : NPR

SAN FRANCISCO — Disgraced Theranos CEO Elizabeth Holmes appears to soon face jail after an appeals court on Tuesday denied her request for release while she seeks to overturn her conviction in a blood test falsification that brought her fleeting fame and fortune .

In another ruling late Tuesday, US District Judge Edward Davila Holmes ordered victims of their crimes to be paid $452 million in damages. Holmes is being held jointly and severally liable for that amount with her former lover and Theranos First Lieutenant, Ramesh “Sunny” Balwani, who is already in prison after being convicted of a wider range of offenses in a separate trial.

The Ninth Circuit Court of Appeals’ decision on Holmes’ attempt to avoid prison comes almost three weeks after she made a last-minute legal maneuver to delay the start of her 11-year sentence. Davila had already ordered her to surrender to the authorities on April 27, and they sentenced her in November.

Davila will now set a new date for 39-year-old Holmes to leave her current home in the San Diego area and report to jail.

The sentence separates Holmes from her current partner William “Billy” Evans, their one-year-old son William and their three-month-old daughter Invicta. Holmes’ pregnancy with Invicta — Latin for “invincible” or “unconquered” — began after a jury convicted her on four counts of fraud and conspiracy in January 2022.

Davila recommended that Holmes serve her sentence in a women’s prison in Bryan, Texas. It was not disclosed whether the Federal Bureau of Prisons accepted Davila’s recommendation or assigned Holmes to another facility.

Balwani, 57, began serving a nearly 13-year sentence in April after being convicted on 12 counts of fraud and conspiracy last July. He was jailed in a Southern California jail last month after failing a similar attempt to remain free on bail while appealing his conviction.

Holmes’ verdict came after a 46-day court hearing and other evidence that highlighted a culture of greed and hubris that infected Silicon Valley as technology gained an increasingly pervasive impact on society and the economy over the past 20 years .

The most exciting moments of the trial occurred when Holmes took the stand to testify in her own defense.

In addition to recounting how she founded Theranos as a teenager after dropping out of Stanford University in 2003, Holmes also accused Balwani of emotionally and sexually abusing her. She also claimed she never stopped believing that Theranos would revolutionize healthcare with a technology that she promised could detect hundreds of diseases and other potential problems with just a few drops of blood.

While pursuing this bold goal, Holmes raised nearly $1 billion from a list of wealthy investors that included Oracle co-founder Larry Ellison and media mogul Rupert Murdoch. These savvy investors all lost their money after a Wall Street Journal investigation and regulatory reviews uncovered dangerous flaws in Theranos’ technology.

In his refund decision, Davila ruled that Holmes and Balwani pay Murdoch $125 million — by far the highest sum among the investors listed in his order. The refund also requires co-conspirators in the Theranos scam to pay $40 million to Walgreens, which became an investor in the startup after agreeing in 2013 to offer some of the flawed blood tests in its dispensaries. Another $14.5 million is owed to Safeway. which also agreed to become a business partner with Theranos before exiting.

In separate hearings, attorneys for Holmes and Balwani tried to persuade Davila that their respective clients should make small payments, if any. Prosecutors had pushed for an $800 million restitution penalty. Both Holmes – whose stake in Theranos was once valued at $4.5 billion – and Balwani – whose stakes were once valued at around $500 million – have hinted they are near bankruptcy after investing millions of dollars accumulated in legal bills while maintaining their innocence.

Holmes’ lawyers are fighting her conviction over alleged errors and misconduct during her trial. They have also contended that errors and abuses affecting the jury were so egregious that she should be allowed to remain out of prison during the appeals process – a request now supported by both Davila and the Court of Appeals of the United States Ninth Circuit was dismissed.