Elizabeth Holmes’ former lover faces sentencing in Theranos case

A former Theranos government learns Wednesday whether or not he might be punished as severely as his former lover and business accomplice for peddling the company’s bogus blood-testing technology that duped buyers and endangered sufferers.

The sentencing for Ramesh “Sunny” Balwani, who was convicted in July of fraud and conspiracy, comes lower than three weeks after Elizabeth Holmes, the company’s founder and CEO, acquired greater than 11 years in jail for her function in the scheme. The scandal revolved across the company’s false claims to have developed a medical gadget that would scan for a whole lot of illnesses and different potential issues with only a few drops of blood taken with a finger prick.

The case threw a vibrant gentle on Silicon Valley’s darkish facet, exposing how its tradition of hype and boundless ambition may veer into lies.

Holmes, 38, may have gotten as much as 20 years in jail — a penalty that U.S. District Judge Edward Davila may now impose on Balwani, who spent six years as Theranos’ chief working officer whereas remaining romantically concerned with Holmes till a bitter cut up in 2016.

While on the witness stand in her trial, Holmes accused Balwani, 57, of manipulating her by years of emotional and sexual abuse. Balwani’s legal professional has denied the allegations.

Former Theranos CEO Elizabeth Holmes sentenced to greater than 11 years in jail for fraud


The two trials had considerably completely different outcomes. Unlike Balwani, Holmes was acquitted on a number of costs of defrauding and conspiring towards individuals who paid for Theranos blood exams that produced deceptive outcomes and will have pointed sufferers towards the flawed therapy. The jury in Holmes’ trial additionally deadlocked on three costs.

Feds search 15 years

Balwani was convicted on all 12 felony counts, and his attorneys contend he deserves a much more lenient sentence of simply 4 to 10 months in jail, ideally in residence confinement. Prosecutors for the Justice Department are looking for 15 years. A probation report recommends 9 years.

Duncan Levin, a former federal prosecutor who’s now a protection legal professional, described Balwani’s bid for a lightweight sentence as “utterly unrealistic.” Levin suspects the decide could give larger weight to the Justice Department and the probation office suggestions, which mirror the sentences these businesses looked for Holmes.

The decide in the end gave her 11 1/4 years in jail and really useful that the sentence be served in a low-security facility in Byran, Texas.

The Justice Department “has now conceded that both defendants deserve the same sentence, even though Balwani was convicted for far more counts,” Levin mentioned. Since Holmes acquired an 11-year sentence, “it follows logically that he will get the same sentence.”

Federal prosecutors additionally need the decide to order Balwani to pay $804 million in restitution to defrauded buyers — the identical quantity sought from Holmes. Davila deferred a call on restitution throughout Holmes’ Nov. 18 sentencing till an unspecified future date.

In court docket paperwork, Balwani’s attorneys painted him as a hardworking immigrant who moved from India to the U.S. throughout the Eighties to develop into the primary member of his household to attend faculty. He graduated from the University of Texas in 1990 with a level in data programs.

He later moved to Silicon Valley, the place he first labored as a computer programmer for Microsoft earlier than founding a web based startup that he bought for tens of millions of {dollars} throughout the dot-com growth of the Nineties.

Balwani and Holmes met across the identical time she dropped out of Stanford University to begin Theranos in 2003. He turned enthralled together with her and her quest to revolutionize well being care.

Balwani’s attorneys mentioned he ultimately invested about $5 million in a stake in Theranos that ultimately turned price about $500 million on paper — a fraction of Holmes’ one-time fortune of of $4.5 billion.

Balwani’s protection

That wealth evaporated after Theranos started to unravel in 2015 amid revelations that its blood-testing technology by no means labored as Holmes had boasted in glowing journal articles that likened her to Silicon Valley visionaries akin to Apple co-founder Steve Jobs.

Before Theranos’ downfall, Holmes teamed up with Balwani to lift almost $1 billion from deep-pocketed buyers that included software mogul Larry Ellison and media magnate Rupert Murdoch.

“Mr. Balwani is not the same as Elizabeth Holmes,” his attorneys wrote in a memo to the decide. “”He truly invested tens of millions of {dollars} of his personal money; he by no means sought fame or recognition; and he has an extended historical past of quietly giving to these much less lucky.” Balwani’s lawyers also asserted that Holmes “was dramatically extra culpable” for the Theranos fraud.

Echoing similar claims made by Holmes’s lawyers before her sentencing, Balwani’s attorneys also argued that he has been adequately punished by the intense media coverage of Theranos, which has been the subject of a book, documentary and award-winning TV series.

Balwani “has lost his career, his status and his means to meaningfully work once more,” his lawyers wrote.

Federal prosecutors cast Balwani as a ruthless, power-hungry accomplice in crimes that ripped off investors and imperiled people who received flawed results. The blood tests were to be available in a partnership with Walgreen’s that Balwani helped engineer.

“Balwani offered a pretend story about Theranos’ technology and monetary stability day after day in meeting after meeting,” the prosecutors wrote in their memo to the judge. “Balwani maintained this façade of accomplishments, after making the calculated choice that honesty would destroy Theranos.”

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