Elizabeth Holmes Files Appeal and Staves Off Jail for a Few Days

(Photo Credit: Emiliano Bar/Unsplash)

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Elizabeth Holmes isn’t going to jail… yet.

The disgraced CEO of defunct health tech company Theranos was supposed to report to prison today, but after requesting an appeal to her fraud conviction, Holmes has managed to finagle some extra time on the outside while the court processes her petition.

Fyre Fest of Health Tech

After attracting hundreds of millions of dollars from investors for blood-testing inventions she knew never worked, Holmes was found guilty of fraud and sentenced to 11 years in prison by a federal court in January 2022. But after having her initial appeal denied and receiving orders to report to prison on Thursday, the once turtlenecked Ted-Talking CEO filed a new appeal directly with the 9th Circuit Court of Appeals in San Francisco, meaning she was automatically allowed to remain free on bail while the court makes a decision.

While something of a desperate tactic, don’t be surprised if more and more white-collar crooks look to Holmes once again for inspiration:

  • If ultimately convicted, newer alleged fraudsters like FTX’s Sam Bankman-Fried and Frank’s Charlie Javice might take note of Holmes’ strategy to keep appealing on grounds that she wasn’t maliciously or intentionally scamming investors, but rather simply running a failed business venture. Who’s to say that crypto princes and student loan platformers can’t make that case and stay in the news until they appear sympathetic?
  • But the new class of SEC villains might want to curb their enthusiasm. Holmes’ literal partner-in-crime, Ramesh “Sunny” Balwani, similarly filed an appeal and it was rejected. He already started serving his 13-year prison sentence.

White Collar, White Shoe: One person who has already capitalized on the Holmes trial is the lawyer that prosecuted her. Jeff Schenk has left his gig as Assistant United States Attorney in the Northern District of California for law firm Jones Day, where he will be a partner in the Investigations & White Collar Defense Practice. Now there’s a TedTalk we’d like to watch.