Judge rejects Elizabeth Holmes’ bid to stay out of jail pending appeal

A federal judge has denied Elizabeth Holmes’ latest bid to stay out of prison, ruling that she must begin serving her more than 11-year sentence on April 27.

The Theranos founder had argued that she should be allowed to remain free while she appeals her fraud conviction for misleading investors in her now-defunct blood-testing startup.

Although Judge Edward Davila ruled that Holmes is not a danger to the community or likely to flee, he wrote that the court was “unable to find that she has raised a “substantial question of law or fact” which if “decided in the affirmative to [her] on appeal’” will likely result in a reversal or new trial.

Holmes was once a subspecies of Silicon Valley — the young, female founder of a promising startup that promised to make health care more affordable and less painful for the masses. Theranos, which Holmes founded while still a student at Stanford University, created a blood-testing device that was claimed to have the ability to run a variety of tests from just a few drops of blood.

Theranos founder Elizabeth Holmes found guilty in landmark Silicon Valley fraud case

The company raised hundreds of millions of dollars from prominent American statesmen and Silicon Valley investors, and Holmes became a success image for young founders. The saga of Theranos is now captured in a best-selling book, a Hulu series and an HBO documentary.

Holmes’ image and the company crumbled in 2015 when a Wall Street Journal investigation revealed that the company’s technology sputtered along — it relied on traditional lab testing machines and typical blood samples to run many of the tests, and the testing was erratic and limited.

Theranos was investigated by regulators and eventually shut down. During Holmes’ four-month trial in late 2021, former employees and partners testified that the public statements about the company’s technology did not reflect the chaos inside the firm.

When Holmes took the stand, she insisted that she was acting in good faith and denied that she had intended to mislead anyone.

But a jury found her guilty on four counts of misleading investors. Ten months later, she was sentenced to more than 11 years in prison and ordered to turn herself in on 27 April.

The Elizabeth Holmes trial is the hottest ticket in Silicon Valley

Holmes then asked the judge to let her remain free during the appeals process. Her attorneys argued in court documents that she is not a flight risk or a danger to the community.

“She has received financial and other support from family and friends, and she continues to work on ideas for patents, as the government notes,” lawyers wrote. “None of this is criminal or poses a danger to society.”

Her lawyers also noted that Holmes has two young children. She was pregnant at the time of the sentencing in November and had her first child in 2021.

But the government signaled that Holmes was a possible flight risk, citing a flight to Mexico her partner had booked for the couple to attend a wedding just weeks after her sentencing. Her defense said the ticket was booked before she was found guilty and was later cancelled.

“Booking international travel plans for a criminal defendant in anticipation of a complete defense victory is a bold move, and the failure to immediately cancel those plans after a guilty verdict is a dangerously careless oversight,” Davila wrote in his latest ruling. “However, after reviewing the attorneys’ contemporaneous communications and immediate subsequent remediation, the Court accepts Holmes’ representation that the one-way ticket — while poorly arranged — was not an attempt to flee the country.”

Elizabeth Holmes learned all the wrong lessons from Silicon Valley

Holmes’ former romantic and business partner, Ramesh “Sunny” Balwani, was convicted in a separate trial of 12 counts of misleading investors and patients. He was sentenced to almost 13 years in prison in December.

The same judge also rejected Balwani’s request to remain out of jail during the appeal, and the former Theranos CEO is scheduled to report to jail on April 20.

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