Theranos founder Elizabeth Holmes makes plea to put off prison as she appeals

FIVE weeks before she is due to report to prison, Elizabeth Holmes made her pitch to remain free on bail as she appeals her fraud conviction.

The Theranos founder on Friday (Mar 17) made what will likely be her last appearance before US District Judge Edward Davila in San Jose, California, who presided over her four-month trial in 2021 and sentenced her in November to serve 11 1/4 years of incarceration for deceiving investors in her blood-testing startup.

Holmes already has initiated an appeal of last year’s jury verdict finding her guilty of multiple criminal counts of defrauding investors. That process could take as long as two years.

The government holds Holmes’ passport, she has two young children, her bail is secured by her parents’ only home, and she continues to work on new inventions, her lawyers argued in a court filing, adding there’s “nothing criminal or dangerous about ideas or patents”. 

Her lawyers say her appeal raises “substantial questions” of law or facts. “After a complex trial, there are many such issues here, any one of which – if resolved in Ms Holmes’ favour – would require a new trial,” her lawyers said in the filing.

At Friday’s hearing, Judge Davila was most interested in an argument the government raised in January that there’s a risk Holmes will try to flee if she remains free in light of what happened a year earlier: a one-way ticket to Mexico was purchased in Holmes’ name during her trial, and before she was convicted. 

The ticket arguably “suggests that the return plans have not yet been made”, the judge said.

Amy Saharia, a lawyer for Holmes, told the judge that prosecutors knew about the plane ticket and remained silent about it long before they raised any objection. The ticket should be a “non-issue”, she said, because it was purchased for a wedding she and her partner Billy Evans hoped to attend, Saharia said. “They were hoping she’d be acquitted, and they could stay and relax,” she said.

Prosecutors argue judge Davila already gave Holmes a “generous” amount of time to report to prison because she became pregnant with her second child between the jury’s verdict and her sentencing. 

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At the hearing, assistant US attorney Kelly Volkar said Holmes’ conviction changed the calculus. The lengthy sentence Holmes faces along with her approaching prison date is a motivation to flee, legally requiring Holmes to prove she’s not a flight risk, Volkar said. “She has an uphill battle here,” she said.

Judge Davila also took up the government’s argument that Holmes should pay about US$800 million in restitution to investors who lost money in Theranos. Holmes argued she should pay nothing, because the investors did not rely on the fraud she was convicted of in their decision-making. 

The judge said he’ll make a decision about the bail request and restitution in the first week of April. BLOOMBERG