Elizabeth Holmes, the disgraced CEO of Theranos, was sentenced to 11 years and three months in prison Friday despite her lawyers imploring the court to place her under home confinement instead.
The sentencing, which occurred in the same courtroom in San Jose, California, where she was convicted in January, marks the end of her story, preserved in history by both an HBO documentary and an award-winning Hulu TV show.
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The former CEO was convicted of conning investors, business partners, and countless patients into believing her now-defunct company had invented a better way to test drops of blood. She had falsely claimed it had the technology to scan for hundreds of health problems using a finger prick.
Holmes, 38, was found guilty on Jan. 3 on four charges of defrauding investors, and she faced up to 20 years in prison and a fine of $250,000, plus restitution for each count. On Nov. 11, her lawyers asked her prison sentence to be reduced to no more than 18 months, preferably in home confinement rather than incarceration, followed by community service. Prosecutors asked for her prison sentence to be 15 years, and the submitted probation report suggested nine years.
U.S. District Judge Edward Davila ruled that Holmes will serve 11 years and three months in prison after over four hours of debate and discussion from both sides. After that, she will serve three years of supervised release. Holmes will self-surrender at a later date that will be determined by the court.
“This case is troubling on so many levels. What went wrong?” Davila said. “This is sad because Ms. Holmes is brilliant. … Failure is normal. But failure by fraud is not OK.”
Davila said evidence shows that Holmes was the leader of the company but not necessarily the “leader of the criminal acts,” which factored into bringing the maximum sentence of 20 years down to 11 years and three months. This was a brief reference to former Theranos President and investor Ramesh “Sunny” Balwani, from whom Holmes said she suffered sexual and emotional abuse.
He mentioned texts between Balwani and Holmes, stating that they show “there was conspiracy.”
“What is the pathology of fraud? Is it the inability to accept responsibility?” Davila said. “Perhaps that’s the cautionary tale to come from this case.”
Holmes, who spoke on the stand before Davila brought down his ruling, was crying and thanked Davila for the chance to speak.
“I stand before you taking responsibility for Theranos. It was my life’s work,” Holmes said. “I am devastated by my failings. I have felt deep pain for what people went through because I failed them. To investors, patients, I am sorry.”
The judge also ruled that a reasonable total loss to investors will be $121 million but that he will set a date to determine what Holmes owes at a later time.
During the sentencing, lawyers were debating whether Holmes displayed “a conscious disregard” or whether it was simply “recklessness.”
Assistant U.S. Attorney Robert S. Leach said Holmes is exhibiting “arrogance” and has never admitted guilt to what happened at Theranos, despite defense attorney Kevin Downey saying she accepted responsibility for her actions.
“This is the kind of platitude we always hear from leaders who are attempting to do damage control after something goes wrong,” Leach argued.
Throughout the trial, Downey had painted Holmes as a “well-meaning entrepreneur who is now a devoted mother with another child on the way,” per the Associated Press, and not a threat to public safety. Over 130 of Holmes’s friends, family, investors, and former Theranos employees had submitted letters to Davila to ask for a lighter sentence for her. That included a letter from Sen. Cory Booker (D-NJ).
Billy Evans, Holmes’s partner, called her “honest, humble, selfless, and kind beyond what most people have ever experienced.”
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Holmes’s original sentencing had been scheduled for Oct. 17 but was delayed to Nov. 18 after Holmes’s defense team asked for a new trial in September. They claimed a key witness had visited Holmes at her home and made statements that undermined his testimony. However, Davila rejected the request for a new trial on Monday.
Balwani was convicted in July of 12 counts of fraud and conspiracy after defrauding investors and patients about the company. As of Nov. 11, his sentencing is scheduled for Dec. 7.
