Walgreens has filed suit against Theranos in Delaware district court, asking for $140 million and alleging a breach of contract.
Walgreens successfully moved to seal the complaint, citing the non-disclosure agreement, so the details of the alleged contractual breach are still unknown. A Walgreens spokesperson confirmed that the company had filed the lawsuit, but declined to add further comment.
Theranos, once a Silicon Valley darling promising accurate blood tests using only a pinprick, recently closed its labs and fired 340 employees after a series of articles exposed that its technology did not work and was putting patients at risk. The startup and its founder, Elizabeth Holmes, have been hit by a growing number of lawsuits in recent months, including at least eight from patients claiming that its technology caused heart attacks or other health problems. It has also been sued by one of its own investors for fraud.
Walgreens had been one of Theranos’ most high-profile partners, even opening 40 "Theranos Wellness Centers" in its Arizona locations and agreeing to partner before even testing the technology. The drugstore chain stopped expanding its Theranos centers last October and ended the partnership in June. The full complaint is sealed.
The lawsuit claims that Theranos misled Walgreens about its technology when the companies decided to partner and again during the period of growing doubt surrounding the start-up, a person familiar with the matter told The Wall Street Journal.
A spokesperson for Theranos said that the company was “disappointed” that Walgreens had decided to file the lawsuit. “Over the years, Walgreens [has] consistently failed to meet its commitments to Theranos,” the spokesperson wrote in an email to The Verge. “Through its mishandling of our partnership and now this lawsuit, Walgreens has caused Theranos and its investors significant harm. We will respond vigorously to Walgreens' unfounded allegations, and will seek to hold Walgreens responsible for the damage it has caused to Theranos and its investors.”
Read the full motion to seal below.
Walgreens v. Theranos by Russell Brandom on Scribd
Correction: The reasons driving this breach of contract lawsuit are unclear. An earlier version incorrectly said that Walgreens claimed that Theranos’ actions violated non-disclosure and confidentiality agreements.