The founder of Theranos was convicted of three counts of corporate fraud and one count of conspiracy.
A California judge has sentenced Theranos founder Elizabeth Holmes to 11 years and three months in prison for defrauding investors in her blood-testing startup that was valued at $9bn.
US District Judge Edward Davila in San Jose, California, convicted Holmes of three counts of fraud and one count of conspiracy. A jury convicted Holmes, 38, in January following a three-month trial.
A judge set a commitment date for Holmes in April. His lawyers are expected to ask the judge to allow him to remain free on bail pending an appeal.
Assistant US Attorney Jeff Schenk told the judge before handing down the sentence that a 15-year sentence would be “a statement that the ends will not justify the means”.
But Holmes’ lawyer, Kevin Downey, urged Holmes’ leniency in the case, saying that unlike a man who committed a “big crime”, he was not motivated by greed.
Holmes asked in court papers for a minimum sentence of 18 months in prison, followed by community service, urging the judge not to make him a “martyr”.
Telling falsehoods
Prosecutors said Holmes criticized Theranos’ technology and funding, including saying that its tiny blood test machine could perform multiple tests from a few drops of blood. The company secretly relied on conventional machines from other companies to conduct patient tests, prosecutors said.
Before sentencing, prosecutors said the 15-year sentence was necessary to deter Holmes and others from committing fraud.
His mistakes “destroyed the trust and integrity” that Silicon Valley’s startup economy depends on, he said.
The state prosecutor’s office agreed to a nine-year prison sentence, according to court documents.
Once valued at $9bn, Theranos Inc promised to revolutionize the way patients receive disease by replacing traditional labs with tiny machines envisioned for use in homes, pharmacies and even on the battlefield.
Forbes named Holmes the world’s youngest self-made billionaire in 2014 at age 30 and his fortune at Theranos was $4.5bn.
But the startup collapsed after several Wall Street Journal articles in 2015 questioned its technology.
At trial, prosecutors said Holmes committed fraud by defrauding investors of Theranos technology out of money rather than allowing the company to fail.
Holmes testified in his own defense, saying he believed what he said at the time was correct.
Although convicted on four counts, Holmes was acquitted of four counts of defrauding patients who paid for Theranos tests.
Davila denied Holmes’ motion to amend his conviction, saying it was supported by the evidence at trial.
Since the verdict has been handed down, Mr. Holmes can challenge the verdicts and his decision in the 9th US Circuit Court of Appeals.
