Elizabeth Holmes, the founder of the failed healthcare technology company Theranos, has started serving her prison sentence for blood test fraud at a federal prison for women in Texas. Last year, Holmes was found guilty of misleading investors by falsely claiming that her company’s machines could perform a range of laboratory tests on just a drop of blood. In November, a federal court sentenced her to 11 years and three months in prison, followed by three years of restrictions and supervision. Holmes is currently appealing the conviction, but this does not exempt her from serving her sentence.
The prison where Holmes is incarcerated requires most inmates to work in a factory, for which they earn about one euro per hour. They can use this money to buy expensive items, such as a radio for €32 or an MP3 player for just under €90 (MP3 files must be purchased separately). Holmes’s ex-boyfriend and former Theranos COO, Ramesh “Sunny” Balwani, has been in custody since April and received nearly 13 years in prison plus three years of supervised probation. The couple are also facing $452m in damages, with plaintiffs seeking significantly more.
Holmes and Balwani both maintain their innocence and are appealing their convictions. The duo had claimed for years that Theranos machines could analyse a single drop of blood comprehensively, which turned out to be false. Blood test results were often fake, or from conventional devices from other manufacturers, and investors lost hundreds of millions of dollars.
Holmes was found guilty of three counts of deceiving investors using telecommunications equipment and conspiracy to commit the same crime. For Balwani, the jury found ten such counts and two conspiracy charges as proven, in addition to cheating on patients, justifying his harsher punishment by over two and a half years.
The case, USA v. Elizabeth A. Holmes & Ramesh “Sunny” Balwani, was filed in the United States District Court for Northern California under file no. CR 18-0258. The proceedings were shared, and the cases are currently with the US Federal Circuit Record of Appeals for the Ninth Circuit (USA v. Elizabeth A. Holmes, Case No. 22-10312, and USA v. Ramesh Balwani, Case No. 22-10338).
