By Cheryl Miller, From The Recorder

SACRAMENTO — Six days after Theranos Inc. confirmed it was forced to void thousands of unreliable blood test results, the Palo Alto-based startup was hit Wednesday with a class action complaint alleging fraud, unfair business practices and false advertising.

Attorneys with McCuneWright, representing a plaintiff identified only as M.P.B., are seeking to certify a national class and an Arizona subclass of Theranos customers. McCuneWright partner Joseph Sauder said the firm believes its complaint is the first to be filed after Theranos’ May 19 announcement.

“Theranos assured its customers that these tests were highly accurate, industry leading in quality, and developed and validated under, and compliant with, federal guidelines,” states the complaint filed in the U.S. District Court for the Northern District of California. “However, the Edison machines did not work, and Theranos’s tests were not accurate … As a result, tens of thousands of patients may have been given incorrect blood-test results, been subject to unnecessary or potentially harmful treatments, and/or been denied the opportunity to seek treatment for a treatable condition.”

Theranos spokeswoman Brooke Buchanan said the lawsuit is “without merit.”

“The company will vigorously defend itself against these claims,” Buchanan said.

The lawsuit—and those sure to follow—is the latest round of trouble for the company with a quintessential Silicon Valley history. Founded in 2003 by Stanford University dropout Elizabeth Holmes, Theranos developed what’s known as the Edison device. A tiny vial collects a few drops of blood to be analyzed by the Edison, which transmits the results to a Theranos database at a fraction of the costs of a traditional laboratory test and without the usual needle stick. The company was valued at as much as $9 billion.

Theranos announced a partnership with Walgreens in 2013 and opened 40 “wellness centers” in Arizona stores and one in a California pharmacy, according to the suit. But the company didn’t have FDA approval to use the Edison device outside of a laboratory setting for anything but a herpes simplex test, McCuneWright alleges.

In March, the Centers for Medicare and Medicaid Services found serious problems with operations at the company’s labs in Newark and in Scottsdale, Ariz., revelations first reported by the Wall Street Journal. Regulators have proposed revoking the license for Theranos’ Newark lab and banning Holmes from the business for two years. The company said in statement that it has made significant changes at its Newark lab. Earlier this month, Theranos announced that Sunny Balwani, president and chief operating officer of the company, was stepping down and retiring.

The suit seeks damages of more than $5 million.

For more on this story go to: http://www.therecorder.com/id=1202758659993/Theranos-Adds-False-Advertising-Suit-to-List-of-Woes#ixzz49lnkaDbf