(CNN Business) – In January, Elizabeth Holmes made history by becoming the lone Silicon Valley entrepreneur to be found guilty of fraud relating to her tenure as the company’s CEO, Theranos, a failing blood-testing venture. Ramesh “Sunny” Balwani, her ex-boyfriend and former second-in-command, was also found guilty of fraud on Thursday by a different jury.
Their consecutive trials, which lasted over a year, marked the end of a startup that gained notoriety and a $9 billion valuation on the promise of revolutionising blood testing but instead turned into a cautionary story for digital entrepreneurs and businesses.
The focus now shifts to their upcoming sentencing hearings, with Holmes’ scheduled for late September and Balwani’s for mid-November, which will occur weeks apart from one another.
The former couple were initially charged jointly with the same 12 criminal offences four years ago, alleging that they had misled patients and investors about Theranos’ capabilities and business practises in order to obtain money.
Their cases were dropped when Holmes made it clear she wanted to charge Balwani with assaulting her physically, emotionally, and mentally throughout the course of their ten-year relationship, which coincided with her time as the company’s CEO. Through his counsel, Balwani has vehemently refuted the accusations.
Holmes’ emotional testimony about the alleged abuse was mostly disregarded by the jury since it was deemed irrelevant to the counts she was facing, although the matter may be taken into consideration in
Holmes and Balwani each face a maximum sentence of 20 years in prison, a $250,000 fine, and restitution on each offence. However, legal professionals assert that receiving the full amount is extremely uncommon. It’s also possible that any prison time imposed as a result of the charges will be served consecutively.
According to Nancy Gertner, a former US federal judge and senior lecturer at Harvard Law School, “the charge defines the most the accused could get, but nobody ever gets the most.” She added that some judges choose to give restitution a higher priority than jail time. “That doesn’t happen as frequently now because it can seem like someone is buying their way out of jail, but it still happens occasionally,”
Final judgement will be made by Judge Edward Davila, who presided over both Holmes and Balwani’s trials, using sentencing standards as a guide. The quantity of money intended to be deceived is one of many variables that Judge Davila will take into account. For instance, there were more than $154 million in wire fraud accusations against individual investors.
Between their convictions and their scheduled sentencing dates, the probation office conducts an investigation into each of the former executives to provide a holistic look at their history — from their family to their financials, as well as their crimes — which will assist the judge in determining a sentence. That may also include factors such as their psychological histories, or any trauma, which is where Holmes’ allegations about the nature of her relationship with Balwani, who is nearly 20 years her senior, may play a role. Holmes and Balwani will also each be permitted to submit sentencing memoranda that make their case to the court for leniency in sentencing.
“The crime itself is only one factor in the sentencing,” Rachel Maimin, a partner at Lowenstein Sandler LLP who specializes in white collar defense, told CNN Business. “It’s a very important factor, but definitely not the only factor. … They’re going to each be judged by their own actions and own life history.”
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