Elizabeth Holmes owes over $25 million to Theranos creditors, lawsuit says

Elizabeth Holmes has not paid more than $25 million to creditors of her former Theranos company as she tries to delay. He was sentenced to 11 years in prisonaccording to a lawsuit.

Theranos ABC, a company set up by its creditors, alleges in a lawsuit filed in California Superior Court in Santa Clara County that “Holmes failed to make any payment due to any promissory note.” Is.”

The lawsuit was filed in December 2022, but did not become public until Friday, when Holmes appeared in court.

According to the breach of contract suit, Holmes executed three promissory notes while she was CEO of a failed blood testing company. According to the lawsuit, the promissory notes were as follows:

  • August 2011 in the amount of $9,159,333.65.
  • December 2011 in the amount of $7,578,575.52.
  • December 2013 in the amount of $9,129,991.10.

“Theranos ABC has demanded payment of Promissory Note # 1 and Promissory Note # 2 from Holmes, but Holmes has failed to make any payments due on the Promissory Note,” the complaint states.

Lawyers for Theranos ABC did not immediately respond to a request for comment.

Two promissory note payments were due, the first in 2016 and the third in 2018. In July 2016, Theranos’ board of directors included Holmes, former Defense Secretary James Mattis, attorney David Boyes, former Bechtel Group CEO Reilly. Bechtel and former Wells Fargo CEO Richard Kvasevich amended the terms to extend the notes to five years. The lawsuit said that the first two notes are overdue and the third is due in December.

Holmes returned to federal court in San Jose, Calif., on Friday, appealing his conviction and asking to delay his report date to prison next month. A prosecutor approached Holmes at his attorneys’ table inside the courtroom. The man, who was becoming increasingly agitated, was removed by the marshals. It was not immediately confirmed whether he was the process server trying to serve the suit on Holmes.

In January 2022, A jury found Holmes guilty of four counts of wire fraud and conspiracy. Holmes was ordered to turn himself in to begin his prison sentence on April 27, 2023. His attorneys have indicated they plan to appeal Holmes’ case to the Ninth Circuit Court of Appeals.

After her guilty verdict last year, Holmes became pregnant and gave birth to a second child.

Holmes’ attorney cited several reasons in explaining. Why is he not a flight risk? Including his young children, he has been out on bail for over a year without escaping.

However, the government pointed to a one-way ticket Holmes and his accomplice, Billy Evans, had booked in Puerto Vallarta, Mexico, days after he was sentenced.

Holmes is also fighting with prosecutors over how much restitution she should pay. Prosecutors want him to pay nearly $900 million, while Holmes argues the government failed to prove investors relied on his representations.

U.S. District Court Judge Edward Davila plans to rule on both motions in early April.

Holmes founded Theranos in 2003 after dropping out of Stanford with a promise to revolutionize the healthcare industry. The company closed in 2016 after a series of failed regulatory inspections and articles by then-Wall Street Journal reporter John Carreiro.

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