Elizabeth Holmes returns to court to try to avoid jail
SAN JOSE, Calif. (AP) — Disgraced Theranos CEO Elizabeth Holmes made what could be her final court appearance Friday before beginning an 11-year prison sentence, unless a judge rules. agrees to his request to remain free while his lawyers appeal his mastermind conviction. a blood test prank.
The 90-minute hearing took place four months after Holmes’ last hearing. That’s when U.S. District Judge Edward Davila convicted her of misleading investors in Theranos, a startup she founded 20 years ago that rose to fleeting fame and fortune from her promises. of a revolutionary blood test technology.
Before the hearing began, a man in the audience at the San Jose, Calif., courtroom tried to approach the table where Holmes was sitting while holding a document in his hand. He was quickly intercepted by security agents who forcibly expelled him. Holmes didn’t seem troubled by the disturbance.
The proceedings ended without it being determined whether Holmes, 39, will be able to stay out of jail while his appeal is heard or turn himself in to authorities on April 27, as currently planned. Davila said he hopes to issue his ruling in early April.
Earlier this month, the judge rejected a similar offer to avoid jail time made by former Holmes lover and convicted Theranos accomplice Ramesh “Sunny” Balwani, who faces a nearly 13-year sentence after a jury found him guilty of 12 counts of fraud and conspiracy. Balwani, 57, was scheduled to report to a federal prison in Southern California on Thursday, but his attorney used a last-minute legal maneuver to buy more time.
Holmes came to her St. Patrick’s Day audience wearing a black blazer and blue skirt. She recently gave birth to her second child, according to court documents that do not disclose gender or date of birth.
One of his lawyers, Amy Saharia, argued that Holmes should be allowed to remain free due to various missteps in presenting and omitting evidence during his four-month trial, making it likely that an appeals court will overturn his conviction on four counts of fraud. and conspiracy.
“We think the case is full of problems,” said Saharia. She specifically cited Davila’s refusal to allow the jury to see a sworn deposition Balwani gave during a Securities and Exchange Commission investigation into Theranos’ downfall which Holmes’ defense team said allegedly helped exonerate him.
Federal prosecutor Kelly Volkar countered there was ‘no likelihood of overturning’ Holmes’ conviction and claimed the trial documented seven different categories of deception she engaged in while handling from Theranos. Most of the deception centered on a device dubbed the “Edison” that Holmes boasted could detect hundreds of diseases and other health conditions with just a few drops of blood taken with a finger prick.
But the Edison produced such unreliable results that Theranos began to rely on third-party test equipment already widely used in the market – a switch that Holmes concealed in an effort to keep the company afloat.
“It was shocking for investors,” Volkar reminded Davila.
The two opposing sides also argued over how much restitution Holmes should pay to defrauded investors whose trust briefly boosted his wealth to $4.5 billion based on Theranos’ peak value before its collapse.
Federal prosecutor Robert Leach argued his conviction for organizing a conspiracy justifying the restitution of nearly $900 million to reimburse Theranos investors swept away by his lies. “Just to apply common sense, the money these investors lost is the money they put in,” Leach said.
But Hollmes’ lawyer Patrick Looby countered that prosecutors were way off base in pursuing an ‘all or nothing’ amount of restitution. He noted that the jury in his trial was unable to rule on three counts of investor fraud, prompting the prosecutor to dismiss those charges. At most, Looby argued, Holmes’ restitution sentence should be limited to the handful of investors who testified at his trial.