SAN FRANCISCO: Fallen US biotech star Elizabeth Holmes faces sentencing on Friday after being found guilty of defrauding investors and endangering patients in a case that became an indictment of Silicon Valley.
Holmes was convicted on four counts in January for persuading investors over 15 years that she had developed a revolutionary medical device before the company flamed out after an investigation by The Wall Street Journal.
US federal prosecutors are seeking a 15-year jail term for Holmes and want her to pay $800 million in restitution to investors that included the Walton family of Walmart, the Walgreens chain of pharmacies and media mogul Rupert Murdoch.
The Theranos founder was “blinded by… ambition,” said US attorney Stephanie Hinds in a court filing arguing for the sentence.
Holmes became a star of Silicon Valley when she said her now defunct start-up was perfecting an easy-to-use test kit that could carry out a wide range of medical diagnostics with just a few drops of blood.
At the time, Holmes often dressed soberly in black turtlenecks that evoked her hero, the late Apple icon Steve Jobs.
She sold investors on the idea that her invention would disrupt medical practice, replacing expensive lab tests with her cheap kits.
Her claims helped Theranos raise nearly one billion dollars without ever achieving meaningful revenue.
Elizabeth Holmes: Silicon Valley’s fallen star
Holmes’s meteoric rise and fast demise has been the subject of books, movies and a TV series that framed her story as a cautionary tale on the excesses of the tech industry that blindly followed a charismatic founder.
At one point, the Theranos board included former US defense secretary James Mattis and former US Secretaries of State, Henry Kissinger and the late George Shultz.
Holmes will appear Friday in front of the same judge who presided over her long trial in a US court in the Silicon Valley city of San Jose, California.
‘Amazing things’
Lawyers for Holmes, 38, have asked for leniency, presenting her as a devoted friend who cares for a young child and has a second child on the way.
This has been backed up by 140 letters of support filed to the court, including from her family, friends and a US senator.
“I am confident that on the other side of this, Elizabeth will do amazing things for society with her talents and boundless passion for changing the world for the better,” said one letter.
This was in sharp contrast to descriptions given at her trial that painted her as an ambitious con artist who harassed her workers.
In a letter, Holmes’s aunt, who was an early investor in Theranos, called on the court to give her a tough sentence, The Wall Street Journal reported.
Experts believe that Holmes will almost certainly receive jail time, given the scale of the fraud and the attention the case received.
Her defense could ask that she remain out on bail pending appeal.
“The government will, I assume, fight to have her start her sentence Day 1 – they want her to go to jail,” former prosecutor Steven Clark told the San Jose Mercury News.
“That will be a difficult call for the court. She’s got another child on the way,” he added.
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