Former Silicon Valley star Elizabeth Holmes, convicted of fraud in January, is due to die on Friday, nearly two decades after founding her startup Theranos, which promised a revolution in health diagnostics.
The prosecution has asked for fifteen years in prison against the 38-year-old former leader, and wants her to return 800 million dollars to the victims.
“Blinded by ambition”, Elizabeth Holmes “stole hundreds of millions of dollars from dozens of investors” and “put patients at risk”, justified prosecutor Stephanie Hinds, accusing her fallen mistress of not taking responsibility.
The defense defended the maximum sentence of one and a half years.
Elizabeth Holmes does not represent a danger to society, she did not derive any financial benefit from this case and, therefore, does not deserve to spend years in prison for having failed in her “ambitious project”, justified her lawyers.
“Ms Holmes was punished for her offense every day, for years and for the rest of her life,” they noted in their argument filed with the court on Tuesday. And “there is no reason to believe that she will lead a publicly traded company in the future,” they continued.
Elizabeth Holmes founded Theranos in 2003, aged just 19, with the idea of making a blood diagnostic tool that was quick, painless and cheaper than traditional labs.
With the help of a very elaborate history and appearance, in a few years she managed to win the trust of luminaries and raise funds from prestigious investors attracted by the profile of this young woman, a rarity in the male world of Californian engineers.
“I thought it would be the next Apple”, summed up during the trial Adam Rosendorff, who was once director of the company’s laboratory.
The story was beautiful. As a child, she hated injections. So she wanted to invent a machine that would perform hundreds of blood diagnoses from a single drop of blood taken from a fingertip.
Media tycoon Rupert Murdoch, former Secretary of State Henry Kissinger and Jim Mattis, Donald Trump’s defense minister, have already been convinced by Elizabeth Holmes’ project.
At its peak, the company was valued at nearly $10 billion.
But in 2015 the scandal came to a head when the Wall Street Journal revealed that the machine never worked.
Elizabeth Holmes, mother of one boy and currently pregnant, is expected to try to push back her arrest date if she is sentenced to jail on Friday.
When prosecutors asked for 15 years in prison, their lawyers compared their client’s situation with that of other people convicted of fraud, such as Jeffrey Skilling, former CEO of Enron, who got a shorter sentence.”
Enron was “a publicly traded company whose bankruptcy, one of the largest in history, resulted in the loss of the savings and investments of tens of thousands of people, including employees,” they noted, and Mr. 42 million dollars (…) after he resigned”.
“Ms Holmes never sold her shares to recoup money, although she had the opportunity,” they added.
Judge Edward Davila, who presided over the highly publicized fifteen-week trial in late 2021, last week rejected his request for a new trial.
The former chief had filed a review request in September highlighting in particular the reversal of a key witness, Adam Rosendorff, who came to his home this summer and spoke there with his partner, William Evans, to express regret.
But the comments of Mr. Rosendorff did not challenge the findings of the investigation, only the presentation of the facts at the hearing, and they were very vague, argued the magistrate.
Ramesh “Sunny” Balwani, former partner of Elizabeth Holmes and chief operating officer of Theranos, was tried separately and was also found guilty of fraud. His sentence is due on December 7.