Elizabeth Holmes and the $452 Million Restitution Bill: The Latest on Her Fight to Avoid Prison

by Joshua Brown
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Elizabeth Holmes, the CEO of Theranos, has been caught doing something wrong and will likely go to prison soon. On Tuesday, her request to stay free until a judge decides if she should be punished for her actions got denied. She is accused of lying about a blood-testing procedure that made her rich and famous.

On Tuesday, a judge ordered Elizabeth Holmes to pay victims of her crimes $452 million. She is sharing this cost with Sunney Balwani, who was already found guilty and sent to prison for more felonies.

Three weeks ago, Holmes tried to postpone her 11-year jail sentence. However, the Ninth Circuit Court denied the attempt. As a result, the judge who previously sentenced her in November (called Davila) will decide on another date for Holmes, who is 39 years old and currently lives in San Diego, to begin serving her prison sentence.

The punishment will separate Kayleigh Holmes from her partner, William “Billy” Evans, their one-year-old son and three-month-old daughter. Kayleigh got pregnant with her daughter Invicta — which is a Latin word meaning “impossible to beat”– shortly after she was found guilty of four charges of fraud and conspiracy in early 2022.

Davila has suggested that Holmes go to a female jail in Bryan, Texas. We don’t know yet if the government’s Federal Bureau of Prisons accepted Davila’s suggestion or sent Holmes to another prison.

Last July, Balwani, who is 57 years old, was found guilty of 12 counts of fraud and conspiracy which resulted in a 13-year prison sentence. He tried to stay out of prison by appealing his conviction but was unsuccessful and sent to be incarcerated at a prison located in Southern California last month.

After 46 days of testimony from court and other evidence, the technology industry during the last 20 years was shown to have a lot of greed and boasting. During this trial, the most interesting part was when Holmes defended herself at the witness stand.

When she was a teenager, Elizabeth Holmes famously quit college to create Theranos. Not only that but she also accused her business partner of mistreating her mentally and physically. Despite all these challenges, she still strongly believed that Theranos will be able to revolutionize healthcare as it has the technology to scan for diseases and other health issues with just a small amount of blood.

Holmes wanted to achieve something extraordinary and she got a lot of money – almost $1 billion – from famous people like Larry Ellison and Rupert Murdoch to do it. Unfortunately, an investigation by The Wall Street Journal revealed that there were big problems with her technology and everybody lost their money.

Davila had decided that Holmes and Balwani must pay Murdoch $125 million, the most among all investors mentioned in his ruling. Additionally, he also said they need to pay Walgreens $40 million because it had become an investor in Theranos and offered flawed blood tests at its pharmacies in 2013. Lastly, Safeway which had initially agreed to be a business partner before backing out must be paid $14.5 million.

The lawyers for Holmes and Balwani argued that their clients should pay very little money, if anything. However, the prosecutors proposed they should pay $800 million in fines. Both Holmes and Balwani mentioned that after paying lots of money for legal fees while defending themselves, they are almost out of cash. Before this incident, Holmes had holdings valued at $4.5 billion and Balwani’s own holdings were worth around $500 million.

Holmes’s lawyers have been asking for her to be allowed to stay out of prison while the court discusses their claims that she has been wrongfully convicted due to many mistakes and misconduct during the trial. But both the judge, Davila, and a higher court, the Ninth Circuit Court of Appeals, have rejected this request.

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