Disgraced Theranos CEO Elizabeth Holmes delays going to prison with another appeal

Former Theranos CEO Elizabeth Holmes arrives at federal court in San Jose, California in March. Photo / AP

Disgraced Theranos CEO Elizabeth Holmes has avoided starting her more than 11-year prison sentence on Thursday by deploying the same legal manoeuvre that enabled her co-conspirator in a blood-testing hoax to remain free for an additional month.

Holmes’ lawyers on Wednesday informed US District Judge Edward Davila that she won’t be reporting to prison as scheduled because she had filed an appeal of a decision that he issued earlier this month ordering her to begin her sentence on April 27.

The appeal, filed with the Ninth Circuit Court of Appeals late Tuesday, automatically delays her reporting date because she has been free on bail since a jury convicted her on four counts of fraud and conspiracy in January 2022. The verdict followed a four-month trial revolving around her downfall from a rising Silicon Valley star to an alleged scam artist chasing fame and fortune while fleecing investors and endangering the health of patients relying on Theranos’ flawed blood tests.

The tactic deployed by Holmes mirrored a move made last month by her former lover and subordinate, Ramesh “Sunny” Balwani, to avoid a prison reporting date of March 16. After the Ninth Circuit rejected his appeal three weeks later, Davila set a new reporting date of April 20.

Balwani, 57, is now serving a nearly 13-year prison sentence in a federal prison located in San Pedro, California after being convicted of 12 counts of fraud and conspiracy.

Although they had separate trials, Holmes and Balwani were accused of essentially the same crimes centred on a ruse touting Theranos’ blood-testing system as a revolutionary breakthrough in health care. The claims helped the company become a Silicon Valley sensation that raised nearly $1 billion from investors.

Holmes, 38, last appeared in court about a month ago, shortly after giving birth to her second child in an attempt to persuade Davila to allow her to remain free while she appeals her conviction. Davila, who scolded Holmes for betraying Silicon Valley’s history of innovation when he sentenced her in November, subsequently rejected that request.

Davila had recommended Holmes be incarcerated at a low-security prison camp in Bryan, Texas, but it has not been publicly disclosed if that is where she has been assigned to serve her sentence.

The news of Holmes’ latest legal manoeuvre emerged the same day that it was announced one of the federal prosecutors who helped convict her is leaving the US Attorney’s office in San Jose, California. Jeffrey Schenk, who also helped convict Balwani in that trial, will specialize in defending people accused of white-collar crimes as a partner for the law firm Jones Day in Silicon Valley.