Arizona Attorney General Announces Intention to Sue Theranos for Fraud

Elizabeth DiNardo, Esq. | Associate Counsel


On January 12, 2017 Arizona Attorney General Mark Brnovich quietly announced, via the state’s website, that he will be pursuing a civil suit for consumer fraud against healthcare technology company, Theranos Inc. The announcement of this suit comes after a string of bad news concerning the healthcare start-up, stemming from a damning investigative article from the Wall Street Journal in October 2015, which exposed the inherent problems with the company’s non-invasive blood testing technology.

 Prior to the explosive Wall Street Times, article Theranos was seemingly an unstoppable presence in the health-tech field, inking a deal with Walgreens in September 2013 to implement Theranos blood-drawing sites in 40 Walgreens locations in Phoenix, Arizona. However, in June 2016 Walgreen terminated its relationship with the company and just a month later, in July 2016, Theranos received sanctions from the Centers for Medicare and Medicaid Services. These sanctions included a renunciation of the company’s CLIA Certificate, which in effect equates to prohibiting Theranos’ founder, Elizabeth Holmes, from owning and operating a lab for two years.

 In the positing to the state’s website, Brnovich elaborated on the suit saying that the goal was to bring a cause of action under the Arizona Consumer Fraud Act to recover civil penalties, disgorgement, restitution, attorneys’ fees, costs, potential injunctive relief and other equitable relief.


Counsel Financial provides working capital credit lines up to $5 million exclusively for the plaintiffs' bar in all states except California, where credit lines are issued by California Attorney Lending