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Judge delays Theranos founder sentencing to September

A federal judge on Wednesday set a September date for the sentencing of fallen biotech star Elizabeth Holmes, who was found guilty.

Theranos verdict sends a chill through startups: analysts
The fraud conviction of Elizabeth Holmes is sending a chill through Silicon Valley - Copyright AFP/File Nick Otto
The fraud conviction of Elizabeth Holmes is sending a chill through Silicon Valley - Copyright AFP/File Nick Otto

A federal judge on Wednesday set a September date for the sentencing of fallen biotech star Elizabeth Holmes, who was found guilty of defrauding investors in her blood-testing startup Theranos.

Holmes is a rare example of a tech exec being brought to book over a company flaming out, in a sector littered with the carcasses of money-losing businesses that once promised untold riches.

Her case shone a spotlight on the blurred line between the hustle that characterizes the industry and outright criminal dishonesty.

Jurors found her guilty of four counts of tricking investors into pouring money into what she claimed was a revolutionary testing system.

US District Court Judge Edward Davila granted a request by prosecutors and defense lawyers to delay the sentencing hearing, letting her remain free on a $500,000 bond secured by property in the meantime.

Davila set the hearing for September 26, according to court documents.

The rival sides agreed that a sentencing hearing after the first week of September “would be appropriate in light of ongoing proceedings in a related matter,” the filing read.

Theranos chief operating officer Ramesh “Sunny” Balwani was charged with fraud along with Holmes, but the one-time business and romantic partners face separate proceedings in federal court in the Silicon Valley city of San Jose.

Balwani’s trial has been delayed until March because of concerns about the risk of Covid-19, according to court documents.

Holmes’s trial ended last week. The 37-year-old now faces the possibility of 20 years behind bars for each of her four convictions.

But the jury also acquitted her on four charges and could not reach a verdict on three others.

Prosecutors will dismiss the undecided charges, according to the motion to delay sentencing.

Holmes had vowed to revolutionize health diagnostics with self-service machines that could run an array of tests on just a few drops of blood, a vision that drew high-profile backers and made her a billionaire on paper by the age of 30.

She was hailed as the next tech visionary on magazine covers and collected mountains of investors’ cash, but it all collapsed after Wall Street Journal reporting revealed the machines did not work as promised.

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With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

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