Theranos has settled a legal battle with a hedge fund which alleged it had been defrauded out of $127 million through "a series of lies" by the disgraced blood testing company.
READ MORE: • Theranos offers shares to investors who promise not to sue
Theranos, which began its spectacular fall from grace in 2015 after an expose revealed its revolutionary blood testing technology was a sham, announced on Monday it had settled two lawsuits brought against it by Partner Fund Management LP. The terms of the settlement were not disclosed, but PFM had previously said it was looking to recoup the entire US$96.1 million (NZ$138 million) it invested with Theranos in 2014.
"Theranos is pleased to have resolved both lawsuits with PFM," said Theranos General Counsel David Taylor.
"Although we are confident that we would have prevailed at trial, resolution of these two cases allows our tender offer to go forward and enables us to return our focus where it belongs, which is on executing our business plans and delivering value for our shareholders."
The Wall Street Journal reports such a significant settlement would represent a significant chunk of the company's reported US$200 million cash reserves as of the end of 2016. Theranos is still facing numerous lawsuits from disgruntled investors, customers, and its former retail partner Walgreens.
Theranos founder Elizabeth Holmes raised more than half a billion dollars from investors hyping the non-existent technology.
At its peak, the company was valued at $11.8 billion, putting Holmes' personal net worth at $5.9 billion, making her America's youngest female billionaire.
Among the company's high-profile investors were Rupert Murdoch, executive chairman of News Corp - publisher of news.com.au - and US Education Secretary Betsy DeVos. After the ruse was exposed, Theranos was embroiled in a string of investigations by numerous US authorities, leading to the closure of labs and the sacking of 340 staff.
The company is now attempting to develop a new product dubbed "miniLab", described as a "portable device ... the size of a microwave ... designed to have the capability to process and analyse very small samples of blood".
Theranos said in a statement that settling the PFM lawsuits "brings to a close the burden and expense of litigation and preserves resources to bring the miniLab platform to market".
In March, Theranos unveiled a plan to offer disgruntled investors extra shares in the company out of Holmes personal 50 per cent shareholding, in exchange for promises not to sue.