Theranos had threatened to seek bankruptcy protection if the investors did not agree to accept additional stock equity in lieu of litigation. Theranos officials said the funds had mischaracterized the exchange offer, which was discussed before the suit was filed. The suit also alleged that Theranos had misled company directors about its practices concerning laboratory testing and that it had secretly bought lab equipment to run fake demonstrations. On May 1, 2017, Theranos announced that it had reached an undisclosed settlement with Partner Fund Management LP (PFM). Theranos's General Counsel, David Taylor, stated: "Theranos is pleased to have resolved both lawsuits with PFM. Although we are confident that we would have prevailed at trial, resolution of these two cases allows our tender offer to go forward and enables us to return our focus where it belongs, which is on executing our business plans and delivering value for our shareholders." In April 2017, Theranos reached a settlement with CMS agreeing to stay out of the blood-testing business for at least two years in exchange for reduced penalties, and signed a consent decree with Arizona Attorney General Mark Brnovich over violations of the Arizona Consumer Fraud Act. Alleged violations included false advertisement and inaccurate blood testing. Theranos agreed to refund $4.65 million to the state's residents for Theranos blood testing services, providing a refund to every resident who had received a test, regardless of whether the test results were voided or corrected. In August 2017 Theranos announced it had reached a settlement with Walgreens. In December 2017 Fortress Investment Group, a wholly owned company of Softbank Group, loaned $100 million to Theranos for 4% of the company. Theranos had reportedly been on the verge of bankruptcy, with the loan meant to keep the company solvent into 2018. The loan was secured by Theranos's patents. On April 10, 2018, the company laid off the majority of workers in a renewed bid to avoid bankruptcy. The company's total headcount was fewer than 25 employees, after having 800 employees at its peak. Softbank's Fortress bought up Theranos patents and later, taking advantage of the new market conditions in the midst of the Covid-19 pandemic, set up a shell company called Labrador Diagnostics which sued one of the companies making Covid-19 tests, saying that its test violated those Theranos patents. Theranos was still being issued patents into 2019 due to the lengthy patent application process. Civil