Theranos Settles Arizona AG Faulty Blood Test Lawsuit for $4.65M

Embattled blood test company Theranos will settle allegations that it sold faulty blood tests in Arizona by agreeing to pay $4.65 million to Arizona’s Attorney General Mark Brnovich.

The Arizona AG hit Theranos with a consumer protection complaint in Arizona Superior Court. This came shortly after Theranos agreed to settle with the Centers for Medicare & Medicaid Services over alleged quality control problems.

Theranos is facing a number of class action lawsuits over its allegedly inaccurate blood tests. The class actions began in May of 2016 after The Wall Street Journal revealed inaccuracies in Theranos’ supposed “tiny blood test procedure.” This led to a federal investigation and the company disclosed that it had to void two years of blood test results. The class actions were consolidated in October of 2016.

The company had claimed that hundreds of tests could be conducted on a few drops of blood obtained by its “revolutionary” device called Edison.

Under the terms of the settlement with the Arizona AG, Theranos will provide a full refund to 175,000 Arizona residents who bought a blood test. This amounts to $4.65 million, along with $200,000 in civil penalties and $25,000 in attorneys’ fess Theranos will have to pay. Theranos has also agreed not to own or operate any labs in Arizona for two years.

“Everyone who paid for a test will receive a full refund, period,” said Arizona’s attorney general. “This is a great result and a clear message that Arizona’s consumer protection laws will be vigorously enforced.”

According to settlement documents, Theranos will not admit fault with regard to the AG’s claims that the company deceived customers about its tests. “Including all consumers who had tests over that time period demonstrated the company’s commitment to resolving the issue amicably on behalf of Arizonans and working collaboratively with state officials,” noted a representative for Theranos. “With the agreement, both parties intend to resolve all existing or potential claims against Theranos, which settled the matter without any admission of liability.”

As a part of a different settlement agreement with the Centers for Medicare & Medicaid Services, Theranos has agreed not to run any labs for two years and to pay a civil fine of $30,000.

The company and its now disgraced founder had marketed its blood testing as revolutionary, requiring only a small blood sample as opposed to multiple vials of blood to conduct various tests. Walgreens had even entered into an agreement to create wellness centers based on the testing technology.

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The Arizona Attorney General’s Theranos Faulty Blood Test Lawsuit is Arizona v. Theranos Inc., in the Superior Court of the State of Arizona, County of Maricopa.