The former CEO and life partner of Elizabeth Holmes has almost 13 years in prison. She has since appealed against her sentence.
Ramesh Balwani outside the federal district court in San Jose on the day of the sentencing.
Ramesh “Sunny” Balwani has been sentenced to 12 years and 11 months in prison, followed by a three-year suspended sentence, for defrauding investors and patients while working for the California blood analysis startup Theranos. Judge Edward Davila at the Federal District Court in San Jose ruled on Wednesday afternoon (local time).
Balwani was the CEO and President of Theranos for six years. Until 2016, two years before the startup had its business license revoked and filed for bankruptcy. Balwani had been the right hand of founder and CEO Elizabeth Holmes; In addition to her business activities, the 58-year-old also had a love affair with Holmes, who was 19 years her junior.
In addition, Balwani will have to pay a fine to compensate for the financial damage to investors. Similar to Holmes, Judge Davila has not yet determined the amount of that sentence.
Balwani, number two, has gotten longer jail time than number one, Holmes
Judge Edward Davila, who presided over Holmes’ criminal trial, said the level of lies Balwani had spread was “worrying”. Balwani and Holmes wanted nothing less than to revolutionize the American healthcare system with the blood analysis startup Theranos. They promised that their analyzer could reliably diagnose numerous diseases with just a drop of blood. This turned out to be a lie, but Holmes and Balwani had forged government and corporate contracts to fool investors.
US prosecutors indicted Balwani and Holmes together in 2018. However, the two charges were later split into two separate criminal cases because Holmes had accused Balwani, 19 years his senior, of sexually and emotionally abusing her during their previous relationship.
In January, a grand jury found Balwani guilty on all 12 counts, including fraud and attempted fraud against investors and patients. In contrast, a grand jury had found Holmes guilty of only 4 counts out of 12, namely fraud and attempted defraud of investors.
What is unusual about the sentence imposed is that although Balwani was number two at Theranos, he will ultimately have to serve a prison sentence about two years longer than the company’s number one, Elizabeth Holmes. This was not only the CEO of the blood analysis company, but also controlled the majority of the shares.
Almost two weeks ago, Holmes was sentenced to 11 years and 3 months in prison; she will then be under surveillance for three years. Even if she could be released earlier because of good behavior, she should according to the specialist publication Law 360 serving nine and a half years in prison; that would be 85 percent of their sentence.
The discrepancy can be explained by the fact that Balwani was found guilty of more charges. Balwani’s lawyers had submitted 60 letters from relatives and acquaintances to the court before the sentence was announced on Wednesday, all of which had made positive comments about the 58-year-old. These included non-governmental organizations based in India, for example, which Balwani supported with donations.
Holmes seeks parole for pregnancy
Meanwhile, Holmes’ attorneys are in federal appeals court in San Francisco Appealed against her guilty verdict and sentence. The trial begins on March 3rd. However, legal experts believe that she has a poor chance of success. With the sentence of 11 years and three months in prison, the judge stayed within recommendations for such crimes, Neama Rahmani, a former prosecutor and co-founder of West Coast Trial Lawyers, told NZZ. The odds were good that Judge Davila’s ruling would be upheld.
In addition, Holmes’ attorneys have requested that Holmes wait until the appeals process is complete, rather than until April 27, as ordered by Judge Davila. However, experts believe that the court of appeals will not comply with the request because it is unclear how long such an appeal process will last.
In the course of the appeal, Holmes’ lawyers also publicly acknowledged for the first time that the 38-year-old is pregnant for the second time, as previously reported by American media. The lawyers argued that Holmes should be allowed to remain at large until the end of the appeals process and that there was no risk of absconding, including because of “her son and her soon-to-be-born child”.
Judge Edward Davila has proposed that Holmes serve his sentence in a women’s prison in Bryan, South Texas, which has relatively low security. However, the prison is 1800 miles from Holmes’ current home in California’s Bay Area.