Elizabeth Holmes returns to court to try to avoid jail

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SAN JOSE, Calif. — Theranos’ disgraced CEO Elizabeth Holmes made what could be her last court appearance on Friday before beginning an 11-year prison sentence unless a judge grants her request to remain free while her Lawyers appeal his conviction for planning a blood test hoax.

The 90-minute hearing came four months after Holmes’s last court hearing. That’s when U.S. District Judge Edward Dávila convicted her of misleading investors in Theranos, a start-up she founded 20 years ago that achieved fleeting fame and fortune thanks to its promises of revolutionary blood-testing technology.

Before the hearing began, a man in the audience in the San Jose, California, courtroom tried to approach the table where Holmes was sitting while holding a document. He was quickly intercepted by security agents who forcibly removed him. Holmes did not seem unnerved by the interruption.

The process ended without a determination on whether Holmes, 39, will be able to stay out of prison while his appeal unfolds or if he will turn himself in to authorities on April 27, as currently scheduled. Dávila said he expects to issue his ruling in early April.

Earlier this month, the judge rejected a similar offer to avoid prison made by Holmes’s former lover and convicted Theranos accomplice, Ramesh “Sunny” Balwani, who faces a sentence of nearly 13 years after a jury found him guilty of 12 counts of fraud and conspiracy. Balwani, 57, was supposed to report Thursday at a federal prison in southern California, but his lawyer used a last-minute legal maneuver to buy more time.

Holmes arrived at 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 did not reveal her gender or date of birth.

One of his lawyers, Amy Saharia, argued that Holmes should be allowed to go free because of several mispresentations and omissions of evidence during his four-month trial that make it likely an appeals court will overturn his four-month sentence. fraud charges. and conspiracy.

“We believe that the registry is fraught with problems,” Saharia said. She specifically cited Dávila’s refusal to allow the jury to see an affidavit Balwani made during a Securities and Exchange Commission investigation into the Theranos crash that Holmes’ defense team believes would have helped exonerate her.

Federal prosecutor Kelly Volkar responded that there is “no possibility of overturn” of Holmes’s conviction, stating that the trial documented seven different categories of deception in which he engaged while running Theranos. Most of the hoax centered on a device dubbed the “Edison” that Holmes had boasted that he would be able to detect hundreds of diseases and other health problems with just a few drops of blood drawn from a finger prick.

But Edison produced such unreliable results that Theranos began to rely on third-party test equipment already widely used in the market, a change that Holmes concealed in an effort to keep the company afloat.

“That was shocking for investors,” Volkar reminded Dávila.

The two opposing sides also sparred over the amount of restitution Holmes should pay to defrauded investors whose trust briefly boosted his wealth to $4.5 billion based on the maximum value of Theranos before its collapse.

U.S. Attorney Robert Leach argued his conviction for engineering a nearly $900 million conspiracy justified restitution to pay off Theranos investors dragged down by his lies. “Just to apply common sense, the money these investors lost is the money they put in,” Leach said.

But Hollmes’ attorney, Patrick Looby, countered that prosecutors were sorely mistaken in seeking an “all or nothing” restitution amount. He noted that the jury in his trial was unable to reach a verdict on three counts of investor fraud, leading the prosecutor to dismiss those charges. At most, Looby argued, Holmes’ restitution penalty should be limited to the handful of investors who testified during his trial.

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