Elizabeth Holmes’s trial ended in January 2022 when she was sentenced to serve more than 11 years in prison. Holmes and her attorneys have delayed her incarceration through different means, but she’s set to begin her sentence on Tuesday, May 30, 2023. The former biotechnology entrepreneur was convicted of fraud in connection with her company Theranos, which claimed to have revolutionized blood testing and made her one of the most prominent young businesspersons in Silicon Valley. Her unique and confusing story has become the subject of several books, podcasts, a documentary, and the Emmy Award-winning TV show The Dropout, in which she was played by Amanda Seyfried. While the world keeps getting fascinated by her journey, she’s getting ready to finally start her prison sentence.
Holmes was once pointed out as one of the greatest visionaries of Silicon Valley. She was featured in Forbes as the youngest and wealthiest self-made female billionaire in the United States, based on the $9 billion valuation the company she founded had achieved. Her personality and leadership style became a topic for journalists to analyze. She convinced investors, reporters, and other CEOs of her vision. However, after the claims that the company had devised quick and accurate blood tests that required very small amounts of blood were proven false, the world turned on her.
While at Stanford University, Elizabeth Holmes had the idea to develop a wearable patch that could adjust the dosage of drug delivery and notify doctors of variables in patients’ blood. She then developed tech for blood tests that could make them cheaper and more accessible to customers. In 2003, she dropped out of college and founded Theranos.
In September 2013, the company became well-known after announcing a partnership with Walgreens. During 2014, she became a sensation and an example for other Silicon Valley entrepreneurs, appearing in several publications. She also registered several patents in the U.S. and other countries.
In 2015, a series of journalistic and regulatory investigations revealed doubts about the company’s claims. In 2018, the U.S. Securities and Exchange Commission charged the CEO and former Theranos chief operating officer Ramesh “Sunny” Balwani, who was in a relationship with Holmes, with raising $700 million from investors through a fraud that involved false or exaggerated claims about the company’s technology. In June, a federal grand jury indicted Holmes and Balwani on fraud charges, which led to their trial.
United States v. Elizabeth A. Holmes, et al.
The case against Holmes and Balwani (who each had their own jury trial) began on August 31, 2021. The jury reached a split verdict on January 3, 2022, with Holmes found guilty of criminal fraud on four counts. On November 8, 2022, she was sentenced to 11.25 years in prison. Balwani was sentenced to 12 years and 11 months plus three years of probation. He surrendered on April 20, 2023. They were both ordered to pay $452 million to the victims of the fraud. During the trial, evidence was provided of Holmes’s role in faked product demonstrations, falsified validation reports, misleading claims about contracts, and overstated financials. There was audio and video evidence of Holmes making inflated or misleading claims about Theranos.
She said that it was not a crime to be optimistic about the possibilities of the technology that she herself was misled about by her staff, maintaining that she wasn’t aware that she was committing fraud. She deflected blame on others, but she also accepted it in some cases.
Holmes also revealed that she suffered from sexual abuse while a student at Stanford, and that led her to Balwani, who was controlling during their relationship and sexually abused her.
After the trial, she delayed her report date by making a last-minute request to remain free, which was denied.
Elizabeth Holmes did an interview with The New York Times (her first in more than six years) before she went to prison. During the conversation, she maintained that she believed in her work at Theranos, that Balwani manipulated her, and that she is a different person now that she is outside the “persona” she created during her time at the company.
She is now married and has two kids (she tried to avoid prison time citing her motherhood). For the past year, she volunteered for a rape crisis hotline, and she still wants to come back to the healthcare business. “I still dream about being able to contribute in that space,” Ms. Holmes said. “I still feel the same calling to it as I always did, and I still think the need is there.”
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