Washington: Elizabeth Holmes, the founder of shuttered blood testing company Theranos, was sentenced to 135 months, or 11 1/4 years, in prison on Friday (local time) for defrauding investors.
She was found guilty in January of duping investors and lying about the technology after a three-month trial. The pregnant Holmes, wearing a black skirt and blouse, was given 135 months behind bars by US District Judge Edward Davila in the same San Jose, Calif., courtroom where a jury convicted her in January, reported New York Post.
Holmes was sentenced to 11.25 years in prison, plus three years of supervised release. At her trial, she was found guilty on four of 11 counts related to defrauding investors, but she was not found guilty of defrauding patients.
Holmes was found guilty on four of the 11 charges, as jurors decided she had lied to investors in an effort to raise money on false pretenses. Holmes was found not guilty on four counts centered on defrauding patients and the jury could not reach a verdict on counts pertaining to the deception of investors, reported ABC News.
At the courthouse in San Jose, both sides of United States vs. Elizabeth Holmes presented their cases regarding whether Judge Edward Davila can consider Holmes’ “reckless disregard” of patients in sentencing. Davila rejected that proposal, since, at the original trial, Holmes was only found guilty of defrauding investors.
The sentence falls short of the maximum possible punishment for Holmes, who faced as many as 20 years in prison.
Holmes was also ordered to serve three years of supervised release after the sentence. Holmes offered a tearful apology before the judge issued the sentence, quoting the poet Rumi, “Yesterday I was clever, so I wanted to change the world. Today I am wise, so I am changing myself,” reported ABC News.
She has been ordered to report to prison April 27. The sentencing marks the latest development in a legal saga that has turned the former billionaire entrepreneur into an emblem of Silicon Valley malfeasance.
Moments after the ruling, the 38-year-old Holmes turned to hug her crying mother. Her lawyers are expected to ask the judge to allow her to remain free on bail during her appeal, which needs to be filed in the next two weeks, reported New York Post.
Holmes’ 135-month sentence was below the 15 years requested by prosecutors. Her legal team had asked for incarceration of no more than 18 months, preferably served in home confinement. A probation report also submitted to Davila recommended a nine-year prison sentence for Holmes.
Once valued at USD 9 billion, Theranos promised to revolutionize how patients receive diagnoses by replacing traditional labs with small machines envisioned for use in homes, drugstores and even on the battlefield, reported New York Post.
Holmes, 38, was convicted in January on four counts of investor fraud and conspiracy while at the helm of Theranos. The verdict followed a four-month trial that detailed Holmes’ trajectory from a Stanford University dropout in 2003 to a star business leader on the cover of Fortune magazine little more than a decade later.
Ultimately, her downfall began in 2015 amid investigations from journalists and regulators over the medical company’s faulty product, which claimed to provide accurate information from tests using just a finger-prick of blood, reported ABC News.
A year later, as the company struggled, Forbes downgraded its assessment of Holmes’ net worth from USD 4.5 billion to USD 0. Facing charges of massive fraud from the Securities and Exchange Commission, Holmes agreed to forfeit control of Theranos in 2018.
Since her conviction, Holmes has filed three unsuccessful requests for a new trial, citing freshly available evidence. She has remained free on bail. Holmes confirmed last week she is also pregnant.