If you haven’t heard, Theranos, the Silicon Valley blood testing company, has been shut down for a while now. The CEO, Elizabeth Holmes, and her right-hand man, Sunny Balwani, have been sentenced to lengthy prison sentences. As a college professor, I was fascinated with the Theranos fallout when the company was exposed by excellent reporting from the New York Times. At the time, my whole class was subscribed to the Times because I was using it as a teaching tool so we experienced the whole saga together. There have since been multiple documentaries, re-enactments, podcasts and books done on the subject. My favorite is probably John Carreyrou’s Bad Blood podcast. Carreyrou is the reporter who exposed Theranos on the front page of the times in 2015.
One thing that is still unresolved is a class action lawsuit that that aims to recover damages from Theranos on behalf of patients in Arizona who used the service through Walgreens and were given faulty results. I have so many questions:
This is all pulled from a 2022 news release:
- Who is eligible for a payout? Anyone who bought Theranos blood tests from November 2013 to June 2016.
- How do they receive a payout? You don’t have to act until after the judgment is rendered. If there is a payout you may become eligible later.
- Does Theranos have any money to pay its victims? Will Theranos still have money left by the time a judgement is rendered? Probably not. That’s why they’re also going after Walgreens which seems to have plenty of money. Walgreens argument is that they were unaware of the issues and it was solely Theranos’ fault and not theirs.
The issue with class-action lawsuits is that the payment is typically so small once it’s split among all the victims that it’s really not worth your time. It may just be a few dollars. Only the lawyers who successfully sue do well in these types of cases (and the losing lawyers do well too if the plaintiffs win). In this case, they’re not suing over real damages such as issues arising from receiving incorrect blood test results, which severely lessens the amount that might be paid out.