In re Arizona Theranos, Inc. Litigation

Theranos, Inc. (defendant) attempted to develop the Edison device, a device that purportedly would be able to reliably conduct hundreds of blood tests using only a few drops of blood, all without needing to outsource testing to a lab. Walgreens (defendant), despite knowing the Edison device was not market-ready, entered into a partnership with Theranos to operate clinics within Walgreens’ pharmacies offering Edison-device blood tests. It was ultimately discovered that Theranos’s Edison device did not work as advertised and that the test results were largely unreliable. Patients who had undergone Edison device blood tests (collectively, the patients) (plaintiffs) filed a medical-battery class-action lawsuit against Theranos and Walgreens. The patients specifically alleged that Theranos and Walgreens had knowingly and intentionally misrepresented vital information about the Edison device and about the essential purpose for which the Edison device blood tests were being offered. Essentially, the patients’ alleged that Walgreens and Theranos misrepresented the Edison device blood tests as reliable blood tests when, in truth, the tests had been offered for the primary purpose of conducting beta testing for research and development purposes. Further, the patients argued that although they had consented to undergo blood testing, Theranos’s and Walgreens’ misrepresentations regarding the essential purpose of the testing had vitiated their consent, meaning rendered their consent legally ineffective. Theranos and Walgreens countered and moved to dismiss, arguing that the patients’ consent had not been vitiated because the essential purpose was to provide blood testing and any research purposes were merely collateral. Walgreens also argued in the alternative that it was not liable for medical battery because it had been unaware that Theranos’s essential purpose was to engage in research and development.