Elizabeth Holmes, the founder of the failed Theranos company, will soon enter prison to begin serving her 11-year prison sentence. This after a judge rejected her request to remain free pending a decision on the retrial petition she filed.
Holmes (39) was convicted last year of defrauding investors and was supposed to start serving the sentence on April 27, but two days before that she submitted the request for a retrial, thereby delaying her entry into prison. Now the judge is expected to set a new date, after ruling that there is no high probability that a new trial will be announced. .
In addition, Judge Edward Davila of the San Jose Court ordered Holmes and her former partner Ramesh “Sunny” Balwani to pay $452 million in restitution to the victims of the fraud.
Theranos, the company Holmes founded after dropping out of Stanford University, promised to make medical diagnoses based on single drops of blood. It managed to raise about a billion dollars from investors, including Oracle founder Larry Ellison and media mogul Rupert Murdoch. But the company collapsed after a Wall Street Journal investigation published in 2015 revealed that the equipment was not performing the promised tests. “The victims’ losses occurred as soon as they exchanged their money for Theranos shares,” the judge stated.
Balwani began serving the 13-year prison sentence imposed on him last month, after he was convicted in July of 12 counts of fraud and conspiracy to commit a crime.
The damages that Holmes and Balwani are required to pay include $125 million to Murdoch, $40 million to the Walgreens pharmacy chain and $14.5 million to Safeway.