In a resounding legal blow, a Ninth Circuit panel on Monday affirmed the criminal fraud convictions of former Theranos CEO Elizabeth Holmes and former executive Ramesh “Sunny” Balwani, cementing their respective 11-year and nearly 13-year prison sentences. The three-judge panel dismissed arguments that the lower court had made crucial evidentiary missteps that prejudiced the jury.
Judicial Panel Stands Firm on Evidence Rulings
A 54-page decision, penned by U.S. Circuit Judge Jacqueline Nguyen, upheld U.S. District Judge Edward Davila’s numerous evidentiary rulings that Holmes and Balwani had challenged during their separate but parallel trials. While the appellate court acknowledged that some layperson witnesses may have been improperly allowed to offer expert testimony, it deemed these errors “harmless.”
The court further upheld an order mandating the two defendants to jointly pay $452 million in restitution to 14 Theranos investors—including a staggering $125 million to media tycoon Rupert Murdoch and $100 million to RDV Corp, the DeVos family’s investment firm. Both Holmes and Balwani are currently serving their sentences.
Theranos: A Cautionary Tale of Silicon Valley’s Fall from Grace
Once heralded as a game-changing Silicon Valley unicorn—reaching a valuation of over $1 billion in 2015—Theranos collapsed spectacularly in 2018 amid a flurry of lawsuits, regulatory scrutiny, and public outrage. The company had promised to revolutionize blood testing with a mere finger prick, but prosecutors argued that the technology never worked as advertised.
