Walgreens Reportedly Paying $44M to Settle Theranos Fraud Claims

Proposed settlement will provide consumers who participated in lawsuit with “approximately double their out-of-pocket damages”

Sandra Levy

9/11/2023

Walgreens has agreed to pay $44 million to settle class action claims by consumers who received flawed blood tests in Arizona and California through the pharmacy chain’s partnership with Theranos.

Walgreens Boots Alliance has reportedly agreed to pay $44 million to settle class action claims by consumers who received flawed blood tests in Arizona and California through the pharmacy chain’s partnership with Theranos, per a Bloomberg report.

The proposed settlement, which needs court approval, will provide consumers who participated in the lawsuit with “approximately double their out-of-pocket damages,” lawyers for plaintiffs said in a court filing Wednesday in federal court in Phoenix, according to the report.

Less than a year ago Theranos founder, Elizabeth Holmes, was sentenced to 11 years and 3 months in federal prison for defrauding investors.

According to The Mercury News, the lawsuit accused the retailer of being “willfully blind” to fraud at Theranos and entering into a partnership with the startup even though it had good reason to suspect its finger-prick testing technology didn’t really work.

Lawyers for the company and consumers filed a notice of a tentative settlement in May but did not disclose the amount of the deal or any other terms. The initial agreement was struck after U.S. District Judge David Campbell ordered the case to go to trial, The Mercury News report noted.

The report also noted that according to the filing, lawyers for the consumers said they believed the evidence would support a finding against Walgreens but acknowledged the judge had said the company had “potent” defense arguments, including that it was also defrauded by Theranos.

A Walgreens spokesperson contacted by Drug Store News (Progressive Grocer's sister brand) said the company declined to comment.

Deerfield, Ill.-based Walgreens, which operates nearly 9,000 retail locations across the United States, Puerto Rico and the U.S. Virgin Islands, is No. 5 on The PG 100, Progressive Grocer’s 2023 list of the top food and consumables retailers in North America.

This article first appeared on the site of sister publication Drug Store News.