Elizabeth Holmes, ‘humble’ and ‘hardworking,’ wants no prison sentence, or maximum 18 months

Convicted Theranos fraudster Elizabeth Holmes is a “humble, hardworking, and compassionate woman who deeply wants to give what she can to the world,” and should be sent to prison for a maximum of 18 months or not at all, she argued in a court filing a week ahead of her sentencing.

“The fact that Ms. Holmes was not motivated by personal gain or greed is a mitigating factor,” the filing said.

Incarceration of Holmes — convicted in January on four counts of defrauding investors in her defunct Palo Alto blood-testing startup out of more than $144 million — is “unnecessary” to deter others from committing such crimes, or to uphold legal principles of just punishment and respect for the law, the filing in U.S. District Court in San Jose said.

“She openly acknowledges her business mistakes and she did not benefit in any material way notwithstanding the opportunity to do so,” the filing said, referring to trial testimony that Holmes never sold any of her Theranos stock, once valued at $4.5 billion. “Her suffering, including among other things extreme public ignominy, financial bankruptcy and the terrifying prospect of incarceration while the mother of a new baby, provides more than ample deterrence to others.”

Former Santa Clara County prosecutor Steven Clark described Holmes’ sentencing memo as “very well done” in general. “It was very strong on who Ms. Holmes is as a person and her admirable traits but it was somewhat tepid on personal accountability and responsibility and remorse,” Clark said, noting that Holmes’ expected appeal makes taking responsibility for her crimes problematic.

Her legal team, in crafting the filing, sought to “convince the judge that this is very different than the other fraud cases that come before him (and) there was never an intent to rip people off,” Clark said. Federal prosecutors, when they file their own sentencing memo soon, will likely focus on the “enormity of the loss” to investors, and Holmes’ lawyers highlighted that Theranos investors were sophisticated and aware of their risk, not “mom and pop investing their life savings,” Clark said.

Holmes, 38, founded Theranos at age 19, and gathered hundreds of millions of dollars in investments based on false claims that the startup’s technology could conduct a full range of tests using only a few drops of blood. She is to be sentenced Nov. 18. Legal experts believe Judge Edward Davila will impose a multi-year prison sentence, possibly mitigated because she has a 16-month-old son. According to a letter to Davila included with her filing, from her partner Billy Evans, a hotel heir, Holmes is pregnant again.

During her four-month trial, which attracted world-wide attention, jurors heard evidence that Holmes, aware that her technology was rife with problems, falsely suggested that Theranos machines were in battlefield use, and in an effort to show major pharmaceutical companies backed her firm, pilfered those companies’ logos and affixed them to internal Theranos reports given to investors.

Her sentencing memo filed late Thursday opened with a focus on her youth when she launched her company “for indisputably good reasons,” and said she “worked tirelessly along with hundreds of brilliant and committed employees to improve access to affordable health information.”

Holmes included in the filing more than 100 letters of support from family, friends and former Theranos employees. The filing summarizes several, describing Holmes as “a warm, thoughtful friend; a loving and dedicated mother and partner; a good listener; a mentor to young women and entrepreneurs; a boss who cared about the company’s employees; a chief executive dedicated to her company’s mission; (and) an intelligent and inventive problem solver.”

Her filing asserts that when problems with her technology started to become apparent, she embarked on “reform efforts” and “took public personal responsibility for Theranos’ failings as early as April 2016—more than two years before her indictment.”

U.S. Senator Cory Booker (D-NJ) was among those providing letters of support for Holmes. Booker wrote that he knew Holmes for six years before her 2018 indictment, and asked Davila to impose a “fair and just sentence” on her. “I still believe that she holds onto the hope that she can make contributions to the lives of others, and that she can, despite mistakes, make the world a better place,” Booker wrote in the letter dated Sept. 9, which referred to his government position but did not bear an official letterhead.

Former U.S. Environmental Protection Agency chief William Reilly, who worked with Holmes’ father Christopher at the agency, submitted a letter asking Davila to “find a constructive path for her to lead a productive future.” Reilly said he met Holmes, whose father was chief financial officer for the EPA during Reilly’s tenure under George H. W. Bush, for lunch as she was preparing for her trial. “Elizabeth made clear during our luncheon conversation that she retains her sense of mission to help humanity,” Reilly wrote.

Holmes acknowledged in the filing that many in the public hold a negative view of her. “Among the countless people in our society who do not know Elizabeth Holmes yet think they know about her case from the unusually intense media coverage of it, Ms. Holmes has become a caricature to be mocked and vilified,” the filing said, adding that Theranos is publicly perceived as “a house of cards, not as the ambitious, inventive, and indisputably valuable enterprise it was.”

If Holmes must go to prison, “a term of eighteen months or less, with a subsequent supervised release period that requires community service, will amply meet that charge,” Holmes’ lawyers asserted in the filing. “The defense believes that home confinement with a requirement that Ms. Holmes continue her current service work is sufficient.”

The filing described the service work. “After her conviction, Ms. Holmes became certified as a rape crisis counselor and advocate, and has spent over five hundred hours volunteering in support of sexual assault survivors, including victims of domestic violence,” according to the filing. Holmes testified at her trial that her co-accused and former romantic partner Sunny Balwani forced sex on her — Balwani, convicted in July, has denied the claim — and that she was raped while a student at Stanford University. The filing specified that she was attacked by a friend at a fraternity party, when she was intoxicated and unconscious.

The 82-page filing includes six pages devoted to her relationship with Balwani, saying the “severe abuse” she allegedly suffered “affected her deeply, including in her role as CEO of Theranos.”