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Disgraced Theranos founder Elizabeth Holmes loses latest bid to avoid prison



Disgraced Theranos chief executive Elizabeth Holmes appears to be soon bound for prison in the US after an appeals court rejected her bid to remain free while she tries to overturn her conviction in a blood-testing hoax that brought her fleeting fame and fortune.

In another ruling issued late on Tuesday (Wednesday AEST), US District Judge Edward Davila ordered Holmes to pay $US452 million ($690 million) in restitution to the victims of her crimes.

Holmes is being held jointly liable for that amount with her former lover and top Theranos lieutenant, Ramesh "Sunny" Balwani, who is already in prison after being convicted on a broader range of felonies in a separate trial.

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The court decision on Holmes' attempt to avoid prison comes nearly three weeks after she deployed a last-minute legal move to delay the start of her 11-year sentence.

She had been previously ordered to surrender to authorities on April 27 by Davila, who sentenced her in November.

Davila will now set a new date for Holmes, 39, to leave her current home in the San Diego area and report to prison.

The punishment will separate Holmes from her current partner, William "Billy" Evans, their one-year-old son, William, and three-month-old daughter, Invicta.

Holmes' pregnancy with Invicta – Latin for "invincible," or "undefeated" – began after a jury convicted her on four counts of fraud and conspiracy in January 2022.

Davila has recommended that Holmes serve her sentence at a women's prison in Bryan, Texas.

It hasn't been disclosed whether the federal Bureau of Prisons accepted Davila's recommendation or assigned Holmes to another facility.

Balwani, 57, began a nearly 13-year prison sentence in April after being convicted on 12 counts of fraud and conspiracy last July.

He was incarcerated in a Southern California prison last month after losing a similar effort to remain free on bail while appealing his conviction.

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Former Theranos executive Ramesh "Sunny" Balwani, seen here in December 2022, will be heading to prison later this month.

The verdict against Holmes came after a 46 days of trial testimony and other evidence that cast a spotlight on a culture of greed and hubris that infected Silicon Valley as technology became a more pervasive influence on society and the economy during the past 20 years.

The trial's most riveting moments unfolded when Holmes took the witness stand to testify in her own defence.

Besides telling how she founded Theranos as a teenager after dropping out of Stanford University in 2003, Holmes accused Balwani of abusing her emotionally and sexually.

She also asserted she never stopped believing Theranos would revolutionise healthcare with a technology that she promised would be able to scan for hundreds of diseases and other potential problems with just a few drops of blood.

While pursuing that audacious ambition, Holmes raised nearly $1.5 billion from a list of well-heeled investors that included Oracle co-founder Larry Ellison and media mogul Rupert Murdoch.

Those sophisticated investors all lost their money after a Wall Street Journal investigation and regulatory reviews exposed dangerous flaws in Theranos' technology.

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Rupert Murdoch was one of the investors in Ms Holme's venture Theranos.

In his restitution ruling, Davila determined that Holmes and Balwani should pay Murdoch $188 million – by far the most among the investors listed in his order.

In separate hearings, lawyers for Holmes and Balwani tried to persuade Davila their respective clients should be required to pay little, if anything.

Both Holmes – whose stake in Theranos was once valued at $6.7 billion – and Balwani – whose holdings were once valued around $752 million – have indicated they are nearly broke after running up millions of dollars in legal bills while proclaiming their innocence.

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