Michelle Mack is taken into custody, Dec. 6, 2023.
CNBC
The ringleader of a nationwide organized retail crime operation that targeted Ulta Beauty and other major retailers is facing more than five years in a California state prison.
Michelle Mack, of Bonsall, California, received a delayed sentence of five years and four months, which will be officially set in January. It was handed down by a San Diego County Superior Court judge on Thursday,
Her husband, Kenneth, received the same sentence and is already incarcerated. As part of his plea deal, he will be released after one year and then put on probation and community service for the remainder of his sentence.
The judge allowed Mack to serve her sentence after her husband is released so she can care for their children. She was ordered not to leave the state or go near any Ulta or Sephora stores.
The couple also must pay about $3 million in restitution to Ulta and another $13,000 to Sephora, according to a court official.
Michelle Mack ran her operation from her 4,500-square-foot mansion in Bonsall, which is outside San Diego, where authorities say she oversaw a network of about a dozen people who stole millions of dollars in merchandise from Ulta, Sephora and other major retailers.
The Macks had pleaded guilty last month to conspiracy to commit a felony and organized retail theft, petty theft, and receiving stolen property.
Attorneys for the Macks declined to comment, according to NBC 7 San Diego.
A CNBC investigation in March detailed Mack’s operation and showed how law enforcement traces stolen items from organized retail rings.
Investigators began referring to the theft group as the “California Girls” and considered Mack the crew’s ringleader. She made millions reselling the stolen items on Amazon via the “Online Makeup Store” to unwitting customers at a fraction of their typical retail price, investigators said, before she and her husband were arrested in December.
Since 2012, Mack had sold nearly $8 million in cosmetics through the storefront before it was shut down, and she brought in $1.89 million in 2022 alone, Amazon sales records provided to investigators show.
The site was closed down after the December arrests.
Earlier this year, Ulta Beauty CEO Dave Kimbell told CNBC in an extended interview about organized retail crime that the “financial impact is real, but way more important is the human impact, the impact it has to our associates, the impact it has to our guests.”
The Macks and seven members of the crew were originally charged with 140 felonies. One of the defendants has received a three-year and four-month sentence, while cases against the others are pending, according to court records.
— CNBC’s Paige Tortorelli, Gabrielle Fonrouge and Courtney Reagan contributed to this story.
Rescuers work at the scene of an Ethiopian Airlines flight crash near Bishoftu, or Debre Zeit, south of Addis Ababa, Ethiopia, Monday, March 11, 2019.
Mulugeta Ayene | Reuters
Boeing has agreed to plead guilty to criminal fraud tied to the fatal 737 Max crashes, a decision that brands the U.S. aerospace giant a felon but allows it to avoid trial while it tries to turn the page from safety and manufacturing crises.
Under the deal, Boeing would face a fine of up to $487.2 million, though the Justice Department recommended that the court credit Boeing with half that amount it paid under a previous agreement, resulting in a fine of $243.6 million. The plea deal requires the approval of a federal judge to take effect.
If the deal is accepted, it could complicate Boeing’s ability to sell products to the U.S. government as a felon, though the company could seek waivers.About 32% of Boeing’s nearly $78 billion in revenue last year came from its defense, space and security unit.
A Defense Department official said Monday the DOD would assess Boeing’s remediation plans and its agreement with the Justice Department “to make a determination as to what steps are necessary and appropriate to protect the Federal Government.”
The plea deal also installs an independent monitor to oversee compliance at Boeing for three years during a probationary period. Boeing would also have to invest at least $455 million in compliance and safety programs, according to a court filing.
Boeing also agreed for its board of directors to meet with crash victims’ family members.
The Justice Department unveiled the deal late Sunday, months after U.S. prosecutors said the aerospace giant violated a 2021 settlement that shielded it from prosecution for three years.
“We can confirm that we have reached an agreement in principle on terms of a resolution with the Justice Department, subject to the memorialization and approval of specific terms,” Boeing said in a statement after the court filing.
In May, the Justice Department said Boeing had violated the 2021 settlement. Under that deferred prosecution agreement, Boeing agreed to pay $2.5 billion, including a $243.6 million criminal fine, compensation to airlines and a $500 million fund for victims’ family members.
That 2021 settlement was set to expire two days after a door panel blew out of a nearly new 737 Max 9 operated by Alaska Airlines on Jan. 5. While there were no serious injuries, the accident created a fresh safety crisis for Boeing. A preliminary report from the National Transportation Safety Board found that key bolts that hold the door panel in place were not attached to the aircraft.
The U.S. accused Boeing of conspiracy to defraud the government by misleading regulators about its inclusion of a flight-control system on the Max that was later implicated in the two crashes — a Lion Air flight in October 2018 and an Ethiopian Airlines flight in March 2019. All 346 people on board the flights were killed.
U.S. prosecutors told family members of the crash victims on June 30 that they planned to seek a guilty plea from Boeing, a plan family attorneys called “a sweetheart deal.”
Shortly after the plea deal was filed in federal court late Sunday night, victims’ family members said in a filing of their own that they would oppose the plea deal, arguing it “unfairly makes concessions to Boeing that other criminal defendants would never receive and fails to hold Boeing accountable for the deaths of 346 persons.”
Paul Cassell, a lawyer for victims’ family members, said the judge should reject the deal and “simply set the matter for a public trial, so that all the facts surrounding the case will be aired in a fair and open forum before a jury.”
The deal requires the corporate monitor who will oversee Boeing’s probation period to be independent, an aspect of the agreement that aimed to solve concerns from the attorneys representing victims’ family members.
It also stipulates there will be no cap on compensation Boeing can pay to the victims’ surviving loved ones. Still, attorneys have said Boeing should go to trial.
“Boeing’s a massive company,” said Erin Applebaum, another of the lawyers for the family members. “Whatever check they write to the families, it’s not going to bring the family members back.”
The actor is about to enter a New Mexico courtroom for the first time since the Oct. 21, 2021 shooting. He is charged with felony involuntary manslaughter. If a jury unanimously convicts him, he could get 18 months in prison.
Baldwin, the star and co-producer of the Western, was pointing a revolver at Hutchins during a rehearsal in a small church on the movie set at Bonanza Creek Ranch when the gun went off, killing her and wounding director Joel Souza. Baldwin has said he pulled back the hammer — but not the trigger — and the gun fired.
Two major themes will predominate, one large, one small: the chaotic atmosphere of the movie set, and the details of the Italian-made classic revolver that Baldwin pointed at Hutchins.
It has never been officially determined who brought the live rounds that killed Hutchins on to the set. Prosecutors at the previous trial of “Rust” armorer Hannah Gutierrez-Reed alleged that she was responsible. She was convicted of involuntary manslaughter and sentenced to the same 18 months in prison Baldwin faces.
What jurors must decide
Prosecutors have two alternative standards for proving the charge. One is based on the negligent use of a firearm. The other is proving beyond a reasonable doubt that Baldwin acted with total disregard or indifference for the safety of others.
Despite the legal and technical complexities of the case, the 12 citizens of Santa Fe County that will make up the jury will have to reach just one verdict — guilty or not guilty — on a single count.
How long is the Alec Baldwin trial expected to last?
The trial at the First Judicial District Court of New Mexico — about 20 miles northeast of the movie set and the shooting — is projected to last nine days, and Judge Mary Marlowe Sommer insists that she’ll keep the lawyers in line and on schedule. Jury selection begins Tuesday, with opening statements expected Wednesday, and the projected end the following Friday. Once the jurors get the case, however, they can deliberate as long as needed.
Why is Alec Baldwin famous?
Baldwin, 66, emerged as a major movie star in the late 1980s and early ’90s through films like “Beetlejuice” and “The Hunt for Red October,” and has remained a household name ever since. He would move on to memorable supporting roles in films including 2003’s “The Cooler,” which got him an Oscar nomination. Comedy dominated his later career as he won two Emmys for playing network executive Jack Donaghy on six seasons of “30 Rock,” and won a third for playing Donald Trump on “Saturday Night Live.”
He has also played the role of an outsized public personality, as a cherished talk-show guest, a sought-after liberal, and at times as a man unable to control his outbursts of anger, which have brought public embarrassment and a previous run-in with the law much more minor than the current one.
Baldwin is the eldest of six children — five of them actors — from Massapequa, New York, who has lived in New York City for most of his adult life. He has an adult daughter, Ireland Baldwin, with his first wife Kim Basinger, and seven small children with his second wife, Hilaria Baldwin.
Alec Baldwin’s defense
Baldwin will bring with him an elite legal team of mostly New York-based attorneys, many of them Harvard Law graduates, from the firm of Quinn Emanuel Urquhart & Sullivan. Alex Spiro, a 41-year-old defense attorney who has represented Elon Musk, Megan Thee Stallion and other prominent figures and has become among the most sought-after lawyers in the country, will give aggressive cross-examination to the state’s witnesses.
The defense will try to show that it is not the job of an actor to make sure real rounds are not in his gun, a position strongly supported by Baldwin’s union, the Screen Actors Guild-American Federation of Television and Radio Artists.
His lawyers will also attack the gun evidence, and the serious damage done to the revolver during an FBI test they say amounted to the destruction of evidence and left the defense no chance to examine it.
Firearms experts for the prosecution who testified at the Gutierrez-Reed trial are returning to the witness stand, over objections by Baldwin, to testify about his handling of the revolver and whether the gun was functioning properly.
And they may press witnesses over whether Hutchins received proper medical treatment between the shooting and the declaration of her death at a hospital.
The prosecution team
Santa Fe County District Attorney Mary Carmack-Altwies appointed Kari Morrissey as a special prosecutor in the Baldwin case in early 2023 after her predecessor stepped down because of conflicts of interest. Morrissey promptly had the indictment against Baldwin dismissed, but revived it in January of this year by grand jury. Both moves came from further examination of the evidence, she said.
Morrissey graduated from the University of New Mexico and its law school and practiced law in Albuquerque for more than 20 years. New Mexico criminal defense attorney Erlinda Johnson joined Morrissey’s team in April.
The trial could bring a culture clash between the team of attorneys, as fiery hearings and filings have already shown.
Morrissey and Spiro in particular have butted heads often — “I’m not going to sit here and be called a liar!” — she said during one such moment at a May hearing — and will likely do the same and provide some drama during the proceedings.
The prosecutors will try to convince jurors that as a producer and the most important person on the set, Baldwin brought a recklessness to the production, and that as an actor he was negligent in handling his gun.
Who’s expected to testify at the Alec Baldwin trial
The crew members inside the small church building who became eye-witnesses to Hutchins’ killing will provide the trial’s most essential testimony. They include director Joel Souza, who was himself shot and wounded by the bullet from Baldwin’s gun, and assistant director David Halls, the film’s assistant director, who some said was responsible for the shooting but pleaded no contest to negligent handling of a firearm.
Zac Sneesby, a crew member who was holding a boom microphone during the rehearsal, will testify that he saw Baldwin pull the trigger of the revolver, prosecutors said in court filings, making him potentially the most important witness of all.
Prosecutors also may call Gutierrez-Reed to the stand, but Marlowe Sommer rejected an immunity deal they wanted to give her.
Jurors will hear testimony from firearms experts who allege the revolver was working properly could not have fired without pulling the trigger.
And Baldwin himself can take the stand in his defense, but he doesn’t have to. His attorneys have not said which he will do.
Where the ‘Rust’ shooting happened
Santa Fe, New Mexico’s capital, an arts mecca of 89,000 people and a tourist destination for its historic Southwestern beauty, is no small town. And its downtown modern legal complex is hardly a country courthouse. But the location is still a far cry from the coastal urban courts where the celebrity trials of Bill Cosby, O.J. Simpson, Harvey Weinstein and Donald Trump were held.
The proceedings could make for an unusual scene. Scores of members of the national media will compete for seats in the Santa Fe courtroom and an overflow room, and cameras will surround the courthouse for arrivals and departures.
And the public can watch. The trial will be streamed and broadcast by several outlets including Court TV.
Who is Halyna Hutchins?
A photograph of cinematographer Halyna Hutchins during a vigil in her honor in Albuquerque, N.M., Oct. 23, 2021.
Andres Leighton / AP
Hutchins, who was 42 when she died, was a cinematographer on the rise and a mother of a young son when she was killed. She grew up on a remote Soviet military base and worked on documentary films in Eastern Europe before studying film in Los Angeles and embarking on a promising movie-making career.
In a virtual court hearing on Monday, the defense asked a New Mexico judge to dismiss the charge because damage to the revolver during FBI testing would prevent Baldwin’s legal team from properly making a case that the gun could have gone off due to a mechanical issue.
“They understood that this was potentially exculpatory evidence and they destroyed it anyway,” Baldwin lawyer John Bash said during the hearing. “It’s outrageous and it requires dismissal.”
Prosecutors argued that the gun breaking into pieces during testing was “unfortunate” but that Baldwin’s team still has plenty of evidence for a defense and did not meet their burden for having the case thrown out.
“A review of the evidence in this case leads one to conclude that the exculpatory value of this firearm, in the condition it was in on Oct. 21, 2021, is extremely low,” said special prosecutor Erlinda Johnson, who added that in an interview on that day with investigators form the Occupational Safety and Health Administration, “Baldwin himself told OSHA investigators that the gun had no mechanical defects” and said he had already been using it for some time.
“The only problem was that it was … there was a live bullet in the gun. Those were his words,” the prosecutor said. “That could not put law enforcement on notice that this gun had, if you believe their theory, some potential mechanical defects when he was interviewed by law enforcement on Oct. 21, 2021.”
Johnson noted that Baldwin, in that referenced interview, did not tell investigators that he didn’t pull the trigger of the prop gun during the rehearsal where it went off. The actor went on to repeatedly claim that he didn’t pull the trigger while defending his innocence in the years since the “Rust” shooting.
Judge Mary Marlowe Sommer said she expects to issue a ruling on the motion to dismiss on Friday.
During the fatal rehearsal on Oct. 21, 2021, Baldwin was pointing the gun at Hutchins on a movie-set ranch when it went off, killing her and wounding director Joel Souza, who survived.
Sheriff’s investigators initially sent the revolver to the FBI only for DNA testing, but when an FBI analyst heard Baldwin say in an TV interview in December that he never pulled the trigger, the agency told the local authorities they could conduct an accidental discharge test.
The FBI was told to go ahead, and tested the revolver by striking it from several angles with a rawhide mallet. One of those strikes caused the gun to break into three pieces.
The FBI had told police and prosecutors the test could do major damage to the gun, which hadn’t been tested by the defense, but the authorities went ahead with the test without bothering to disassemble it and photograph its parts first, thus eliminating their most critical evidence in the case, Baldwin’s lawyers argued.
“We can never use our own expert to examine that firearm,” Bash said.
The prosecution argued that the gun was not destroyed as the defense said.
“The parts are still available,” said Johnson. “The fact that this gun was unfortunately damaged does not deprive the defendant of ability to question the evidence.”
But Baldwin’s lawyers said the damage done to the top notch on the revolver’s hammer rendered the most important testing impossible.
They argued that if Marlowe Sommer declined to throw out the case, she should at least not allow any of the technical gun analysis to be presented at trial.
Baldwin’s attorneys gave long and probing cross-examinations to the lead detective, an FBI forensic firearm investigator and the prosecution’s independent gun expert in testimony that was likely a dress rehearsal for the high profile trial, where Baldwin, who was not on the online hearing, will be appearing in person.
The special prosecutors running the case argued that those cross-examinations proved that the defense has plenty of gun evidence to work with at the trial.
“They have other reasonable available means to making their point,” Johnson said.
She added that all available evidence, from witness testimony to video of Baldwin firing the gun in movie footage, showed that the gun was in good working order on the day of the shooting, and that police had no reason to believe its internal workings could provide exonerating evidence.
Prosecutors plan to present evidence at trial that they say shows the firearm “could not have fired absent a pull of the trigger” and was working properly before the shooting.
Defense attorneys are highlighting a previously undisclosed expert analysis that outlines uncertainty about the origin of toolmarks on the gun’s firing mechanism.
Baldwin has pleaded not guilty to the involuntary manslaughter charge, which carries a maximum sentence of 18 months in prison.
On Friday, the judge denied prosecutors’ request to use immunity to compel testimony from Gutierrez-Reed at Baldwin’s trial. Her statements to investigators and workplace safety regulators will likely feature prominently in Baldwin’s trial.
Last year, special prosecutors dismissed an involuntary manslaughter charge against Baldwin, saying they were informed the gun might have been modified before the shooting and malfunctioned. But they pivoted after receiving a new analysis of the gun and successfully pursued a grand jury indictment.
Roche Diabetes Care Inc. Accu-Chek brand glucose test strips are arranged for a photograph in the Brooklyn borough of New York, U.S., on Thursday, April 4, 2019.
Alex Flynn | Bloomberg | Getty Images
Roche, one of the world’s largest biotech companies, said “dangerous counterfeits” of its diabetes medical devices ended up for sale on Amazon to be bought by patients throughout the United States.
Roche accused manufacturers and sellers based in India of selling counterfeit versions of its Accu-Chek devices, which are used to test blood glucose levels. The company made the claim in a federal lawsuit unsealed late Friday.
“Patients know that Roche’s Accu-Chek medical devices are safe, sterile and accurate,” the complaint said. Roche said the counterfeit test strips are expired or nearly expired products that are repackaged with counterfeit labels bearing Roche’s registered U.S. trademarks and fake expiration dates.
It warned that the counterfeit devices are “likely to give false or inaccurate measurements of blood glucose levels, putting patients at risk of severe and life-threatening complications, such as hyperglycemia and over- or under-dosages of insulin.”
The lawsuit, which was filed under seal in May in the U.S. District Court in the Brooklyn borough of New York City, named as defendants four companies and their executives, all based in India. Roche is seeking unspecified damages.
After the suit was filed, a judge granted Roche’s request for a temporary restraining order to stop the defendants from selling the counterfeit products. The Amazon stores that were offering the products for sale appear to have been taken down.
Amazon is not a defendant in the case, but Roche claims that as part of the alleged scheme all of the counterfeit products sent to the U.S. were stored at Amazon warehouses across the country, including in Brooklyn. The products are typically shipped to businesses and individuals within 48 hours of landing at Amazon facilities.
“Amazon currently has untold numbers of these dangerous counterfeit medical devices in its warehouses across the country, ready to deliver to unsuspecting American consumers at the click of a button,” the complaint said.
Roche said the counterfeiters participated in Amazon’s Fulfillment by Amazon program, through which “Amazon agrees to receive, store, and accept orders on behalf of the counterfeiters; to pick, pack, and ship the counterfeit goods; and to provide customer service for the counterfeiters. … Amazon, in return, receives a sizable percentage of the revenue from the counterfeit sales,” according to the complaint.
An Amazon spokesman told CNBC that the company has “a zero tolerance policy for counterfeit products. We have proactive measures in place to prevent counterfeit products from being listed and continuously monitor our store. If we identify an issue, we act quickly to protect customers and brands, including removing counterfeit listings and blocking accounts, and collaborating with brands and law enforcement to protect our customers from bad actors attempting to abuse our store.”
The complaint was filed on behalf of Roche Diabetes Care Inc., Roche Diabetes Care GmbH and Hoffmann-La Roche Inc, by attorneys with the New York-based law firm Patterson Belknap Webb & Tyler.
The defendants are JMD Enterprises doing business as DKY Store USA, JMD Enterprises founder and owner Dileep Kumar Yadav, JMD International, JMD International owner and founder Abhishek Jain, Medical Hub_USA Store, Medical Hub_USA owner Ratnakar Sharma, Authentic Indian Store and Authentic Indian Store owner Atikur Rahman.
CNBC contacted the defendants for comment, but has not yet received responses.
A spokesperson for Roche told CNBC that the company does not comment on ongoing lawsuits.
Counterfeit medical devices
Roche’s Accu-Chek diabetes care medical devices, used by millions of patients, include Accu-Chek glucometers, blood glucose test strips and lancets. The company’s blood glucose test strips and lancets can be purchased with or without a prescription at pharmacies and online marketplaces, including Amazon.
Roche Accu-Chek SoftClix
Source: Roche
The lancets are specialized disposable needles used to draw blood for testing.
The packaging on the counterfeit devices at the center of the lawsuit includes a misspelling of the name of the product as well as fake serial numbers and expiration dates, according to the complaint.
These counterfeit Roche products show the product’s name misspelled.
Source: U.S. District Court filing
The company launched an investigation into the counterfeits in late March when a whistleblower reached out with information, according to the complaint. Its investigators then purchased the products from the three Amazon stores listed in the complaint, the lawsuit said.
As recently as May, a customer left a negative review on Amazon’s platform, complaining that he had ordered test strips from the DKY Store but received a different product. In March, a different customer said the lancets she purchased from DKY were fake.
Fake identical serial numbers on the packages are another indicator of counterfeits.
Source: U.S. District court filing
Roche did not specify how long the counterfeit items were being sold on Amazon, or how many ultimately made it to customers.
The issue of potentially dangerous glucose test strips emerged in 2019 when the Food and Drug Administration warned against using test strips from a previous owner or ones not authorized for sale in the U.S. At the time, the FDA said faulty test strips were being sold via online marketplaces and individual sellers.
In 2011, Johnson & Johnson said it found counterfeit versions of its glucose test strips in India.
CNBC in March reported findings of an investigation into stolen items sold on Amazon’s marketplace via organized retail crime rings. The report centered on millions of dollars of items stolen from Ulta Beauty that were being sold for more than a decade on the platform.
People wait in in a queue to enter CityMD, a health clinic that offers coronavirus disease (COVID-19) testing, on the Upper West Side as the Omicron coronavirus variant continues to spread in Manhattan, New York City, U.S., December 19, 2021.
From February 2020 to April 2022, CityMD, which operates over 100 walk-in urgent care practices in New York and New Jersey, allegedly obtained fraudulent government reimbursements for Covid tests by submitting false claims to a Covid program specifically designated for uninsured patients, even when their patients had health insurance.
The U.S. Attorney’s Office for the District of New Jersey brought the allegations under the False Claims Act, a law that incentivizes whistleblowers to file lawsuits related to potential fraud by providing them a portion of the government’s winnings in successful cases.
“Uninsured Americans who were at risk from COVID-19 were covered by emergency funding programs that made available to them the testing, vaccines and treatments that they needed,” U.S. Attorney Philip R. Sellinger said in a Friday statement. “The alleged misuse of these funds is something we cannot and will not tolerate.”
Stephen Kitzinger, a CityMD patient, initially alleged the fraud in 2020. As a reward for bringing the case to the government’s attention, Kitzinger will receive over $2 million of the settlement.
Kitzinger’s attorney did not immediately respond to a request for comment sent outside of regular business hours.
CityMD cooperated with the government’s investigation and hired a third-party firm to help the government determine how much was lost in connection as a result of the alleged fraud, according to the DOJ.
CityMD said it denies the allegations but has decided to settle in order to to avoid the costs of dragged-out litigation.
“The recent settlement is neither a finding of liability nor an admission of wrongdoing, and CityMD denies the allegations. However, we settled this matter to avoid the cost and burden of prolonged litigation,” a CityMD spokesperson said in a statement to CNBC on Saturday. “CityMD is proud of the health care services we provided to patients throughout the pandemic.”
Elizabeth Holmes, founder of Theranos Inc., arrives at federal court in San Jose, California, March 17, 2023.
Benjamin Fanjoy | Bloomberg | Getty Images
Imprisoned Silicon Valley CEO Elizabeth Holmes has shaved more months from her initial 11-year-plus sentence for wire fraud and conspiracy, federal records show, and is due to be released two years earlier than expected.
Holmes, 40, has a current release date of Aug. 16, 2032, from a women’s federal prison in Bryan, Texas, according to the Bureau of Prisons. Last July, her expected release date was listed as Dec. 29, 2032.
The disgraced founder of failed blood-testing startup Theranos entered prison in May 2023 after she was handed a 135-month prison sentence for defrauding investors out of hundreds of millions of dollars.
While the BOP declined to comment specifically about Holmes’ status for privacy and security reasons, the agency said in a statement that “projected release dates are calculated with several factors in mind.”Inmates are eligible for “good conduct time,” and those who qualify can earn up to 54 days for each year of sentence imposed by the court. In addition, inmates can see more time taken off their sentences by earning time credits that accrue when they complete certain prison and work programs, part of the federal government’s way to reduce recidivism and ease the prison population.
Time credits are awarded over a 30-day period for programs related to anger management, mental health, financial literacy and other topics that seek to address behavior and instill personal skills. Once the credits are calculated and it is determined those credits equal the time left on the sentence, the inmate can be transferred out of prison into “pre-release custody,” such as a halfway house or home confinement. Some may also be eligible for supervised release like probation.
Supporters of the Trump-era law say they believe it can cut particularly harsh sentences for nonviolent drug offenders and lessen the racial disparities affecting people of color in the criminal justice system, although the calculation of time credits has come under scrutiny in recent years.
A lawyer for Holmes did not respond to a request for comment about her prison sentence.
Along with Holmes, Theranos Chief Operating Officer Ramesh “Sunny” Balwani was also convicted at a separate trial for his role in the Theranos fraud, getting sentenced in December 2022 to nearly 13 years in prison.
He is currently set to be released on Nov. 22, 2032, from a federal prison in Southern California, which would be two years soonerthan expected. His lawyer declined to comment about his prison time.
Meanwhile, a federal appeals court in San Francisco is set to hear oral arguments for Holmes’ appeal on June 11. The appeal will deal with “convictions, sentences, and restitution orders” related to the case, according to the court calendar. Balwani is also supposed to have his appeals case heard at that time.
After giving birth to her second child in early 2023, Holmes attempted to remain free on bail while appealing her conviction, but a judge denied that request.
Theranos, which said its technology could give users health data by testing blood from a single finger prick, became emblematic of startups that lured investors with false promises in the early 2000s. Holmes’ rise as a Stanford University dropout-turned-Silicon Valley sensation was the subject of investigative reports and a TV series that sought to scrutinize her dramatic story.
O.J. Simpson, the former football star and central figure of a sensational 1995 murder trial, passed away from prostate cancer. Simpson was found not guilty of killing his ex-wife Nicole Brown Simpson and her friend Ron Goldman. The charges, the trial and the verdict exposed a dramatic divide among Americans along racial and cultural lines. Bill Rhoden, a columnist for ESPN’s “Andscape” who covered Simpson for decades, talks to “CBS Mornings” about Simpson’s complicated legacy.
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Former U.S. President Donald Trump holds up a news story about New York Attorney General Letitia James as he speaks to the media at one of his properties at 40 Wall Street following closing arguments at his civil fraud trial on January 11, 2024 in New York City.
Spencer Platt | Getty Images
Donald Trump cannot obtain a bond to secure the $454 million civil business fraud judgment against him as he pursues an appeal of the case, his attorneys said in a New York court filing Monday.
Attorneys for Trump and his co-defendants in the fraud case argued that it was “impossible” for them to secure a complete appeal bond, which would “effectively” require “cash reserves approaching $1 billion.”
“Defendants’ ongoing diligent efforts have proven that a bond in the judgment’s full amount is ‘a practical impossibility,’” the lawyers wrote, quoting an affidavit in the filing with the Appellate Division of Manhattan Supreme Court.
They said they have approached roughly 30 surety companies through four separate brokers, and that they have spent “countless hours negotiating with one of the largest insurance companies in the world.”
The lawyers said that if the appellate division considers denying the requested stay of the judgment, it should schedule oral arguments on the issue. And if the division declines to grant the stay, the lawyers asked that it allow them to file an appeal with the Court of Appeals, the highest state court in New York.
Manhattan Supreme Court Judge Arthur Engoron in February ordered Trump and his co-defendants to pay a total $464 million in damages and interest for violating a New York anti-fraud statute. Of that total, Trump was ordered to pay $454 million. Trump’s post-judgment interest continues to accrue at a rate of nearly $112,000 a day.
The case brought by New York Attorney General Letitia James accused Trump, his two adult sons, his company and its top executives of falsely inflating Trump’s asset values for years to boost his net worth and get financial perks.
The defendants had previously offered to post a $100 million bond, less than one-fourth the total judgment, in order to pause James from collecting the penalties during the appeal process.
Appeals court Judge Anil Singh rejected that proposal, but allowed the defendants to continue doing business in New York and lifted Engoron’s three-year ban on Trump seeking loans in New York. Singh’s order is temporarily in effect before a full appeals court panel hears the motion for a stay.
Trump’s attorney Alina Habba did not immediately respond to CNBC’s request for comment on the filing.
Trump earlier this month obtained a $91.6 million bond from the Chubb insurance company to secure a civil defamation judgment against him in favor of the writer E. Jean Carroll while he appeals that judgment.
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