Some Charges Dropped Against Elizabeth Holmes In Theranos Case
On Tuesday, a judge dismissed several criminal charges in the court case involving Elizabeth Holmes, the founder of the failed blood-testing startup Theranos. It's a partial win in a legal battle that bankrupted her company.
Holmes is accused of falsely claiming Theranos technology could run dozens of blood tests with a single drop of blood.
If convicted, Holmes and the company's former COO, Ramesh "Sunny" Balwani, could face 20 years in prison and a fine of $250,000 for each conviction. Both have pleaded not guilty.
Responding to a motion filed by the defense to dismiss several charges, U.S. District Judge Edward Davila denied most of the requests from the defense but he did grant a partial dismissal on four charges against the duo, narrowing the case brought by the Department of Justice.
In his Tuesday ruling, Davila dismissed one count of conspiracy to commit wire fraud and three counts of wire fraud, on the basis that the government failed to allege that Holmes and Balwani had a specific intent to defraud doctors and "non-paying patients," those fully covered by insurance.
In 2018, Theranos and its chief executive officer agreed to settle fraud charges with federal regulators, which stripped Holmes of majority control of the company, surrendering 19 million shares. Holmes agreed to pay a $500,000 fine and was barred from being an officer or director of a public company for 10 years.
In 2017, a consumer lawsuit from Arizona’s attorney general was settled. Theranos customers in Arizona were awarded $4.6 million in refunds in a consent judgment reached with the Attorney General’s Office.
The trial date is set for Aug. 4.