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Elizabeth Holmes found guilty

• latenightcoding 5y ago
  Question: could Holmes have avoided all of this by pivoting to something else and not losing investors money. It is extremely common for startups to exaggerate their tech just to later pivot to something else without any repercussions.
  • ShamelessC 5y ago
    If you have to ask yourself questions like these (as a founder) - you may very well end up in jail one day.
  • deleted 5y ago
    [deleted]
  • neom 5y ago
    I followed the case very closely, read the transcripts I could find daily etc. What Elizabeth did wasn't far from what many many many founders do. This was held to a legal standard, sure, but let's be real here... since when was the legal standard the SV standard? Is SV really the bastion of morality and legal ethics? Is that the new norm, good behaviour? Notably some investors refused to participate and iirc Draper basically said she flew too close to the sun, but it wasn't fraud. I'm sure it's going to be an unpopular opinion but personally if this is the new standard, the SEC should have a pretty long list of founders to try at this standard. The saddest thing of it all to me is that she was onto something, people are having success with her ideas today. She should have just not gone to market, she should have just quietly refined the tech behind the scenes, but as I said, she flew too close to the sun. Tesla and uber have literally killed people.
    • miohtama 5y ago
      "Scaling too fast" has definitely a better vibe to it than "found guilty" :)
    • dopamean 5y ago
      > What Elizabeth did wasn't far from what many many many founders do I'm not sure this is true. She told a lot of egregious lies to investors while trying to get money from them. She repeated those lies in the press and to anyone who questioned it. And I don't mean a lie like lying that your product is more effective than it is. I mean she told prospective investors about huge contracts with the defense department that did not exist. She told investors that her machines were being use in the battle field. These were lies that were never going to be true.
      • neom 5y ago
        That's not what she said at all. At least not from the near daily coverage and transcripts I watched[1][2][3][4] She said it was being trialed by the military, in reality what had happened was Mattis said he would be able to introduce the technology to the military. This type of "abstraction" is in very many pitches I've read over the years. [1]https://www.youtube.com/c/LawyerYouKnow https://www.youtube.com/c/LawyerYouKnow [2]https://www.youtube.com/channel/UCOShJ_GPEegXscrlKWfpwCA https://www.youtube.com/channel/UCOShJ_GPEegXscrlKWfpwCA [3]https://www.youtube.com/channel/UCiWXvA_5bzvOFdbS353Ll-Q https://www.youtube.com/channel/UCiWXvA_5bzvOFdbS353Ll-Q [4]https://www.youtube.com/channel/UCwCqasesYi60fSrOjlUSNzg https://www.youtube.com/channel/UCwCqasesYi60fSrOjlUSNzg
        • CRConrad 5y ago
          > This type of "abstraction" is in very many pitches I've read over the years. Nice of you to use quote marks... Because that's not at all what "abstraction" means.
        • PragmaticPulp 5y ago
          > She said it was being trialed by the military, in reality what had happened was Mattis said he would be able to introduce the technology to the military. This type of "abstraction" is in very many pitches I've read over the years. That's not an "abstraction". It's a lie, and therefore fraudulent. If you're seeing these sort of lies all over the place, you might be in a weird bubble. Startups are known for creative wordplay, but if you're straight up lying about something happening when it's not happening at all or even started, that's fraud.
    • kstrauser 5y ago
      > people are having success with her ideas today Citation needed. The whole concept has a critical flaw, as pointed out by her engineering staff and medical advisors: blood tests require a certain minimum volume of blood to work, and that's inescapable because blood components are discrete, not continuous. For example, a drop of blood is about .05mL, or about 1/20th of a milliliter. A common testing sample size in a normal lab is 3mL, or about 60x larger what Theranos claimed they could work with. Now, suppose you're testing for some cell that's may be present in concentrations of 10 per mL, or 1 per .1mL blood volume on average. In a conventional lab, then, you'd probably have about 30 of those in the 3mL sample. In a Theranos lab, even if it worked perfectly, you're equally likely to have either 0 or 1 present in the .05mL sample. In other words, you're 50% likely to get a false negative, even if the equipment is working perfectly, based purely on the tiny sample volume. By analogy, if you poll 100,000,000 Americans, you might get a pretty good idea of an election's result. If you poll 3, you have no idea, even if the poll is perfectly designed. Well, that's what Theranos was up against. NB: I'm not a lab tech, and the above is my understanding of it. That's my distillation of a lot of articles I read about Theranos, such as https://theconversation.com/the-rise-and-fall-of-theranos-so-many-lessons-in-a-drop-of-blood-57787 https://theconversation.com/the-rise-and-fall-of-theranos-so... .
      • megablast 5y ago
        No need to poll 100 million. 20,000 is pretty accurate.
        • kstrauser 5y ago
          OK, sure, but that doesn't change my point. You could run all of someone's blood through a scanner and then back into them to get a complete view, but a lab only samples a few mL of it.
        • dvhh 5y ago
          Usually your sample size would be a good indicator of the accuracy of your poll/test/experiment. Of course, like everything it could be biased by the used methodology.
      • 5y ago
    • PragmaticPulp 5y ago
      > What Elizabeth did wasn't far from what many many many founders do. Hard disagree on that one. It's certainly not common nor acceptable to knowingly lie to investors like Holmes did. There is nothing normal or common about the type of fraud that Holmes perpetuated, despite attempts to downplay or normalize it. > I'm sure it's going to be an unpopular opinion but personally if this is the new standard, the SEC should have a pretty long list of founders to try at this standard. Can you name a single one? Or is this just cynical speculation? I've seen a lot of attempts to downplay Theranos' blatant fraud as an "everybody does it", but I haven't seen anyone calling out other companies who were caught committing fraud and everyone, including their investors, just shrugged it off. It's not normal.
      • neom 5y ago
        Of course I can name multiple, I've been involved in hundreds and hundreds and hundreds of millions of dollars in startups deals, I've spent over 15 years in the industry...
        • bern4444 5y ago
          Are you willing or can you share the names of some of these companies?
          • neom 5y ago
            No. I don't think what they did was wrong a), and, b) because it genuinely is prevalent. Maybe if the statue of limitations passed on some of the startups I've been involved in, I might consider it, but even then, doubtful.. It doesn't matter what was done, the startups were successful and the investors got paid back, so who is going to ask questions and why?
            • CRConrad 5y ago
              Frankly, making an outrageous claim and then just blithely going "Nope, I'm not going to give even a single example" makes it sound like you are spouting just as much bullshit as Holmes did. Or alternatively, like you're just not understanding the difference between over-optimistic forecasts and claims of actual outcome. Which is it?
    • hooande 5y ago
      No. It's one thing to say "My company is going to change the world" or "I am the best president of all time". It's different to repeatedly make a claim that is verifiably untrue, like "I have perfected cold fusion" or "I have a cure for all forms of cancer". The average startup founder doesn't do this, no sane person does this. > "The saddest thing of it all to me is that she was onto something, people are having success with her ideas today." This is a very poorly informed statement. Who bought the valuable IP that Theranos spent hundreds of millions of dollars developing? No one is "having success with her ideas" because the ideas didn't exist. That's why she's going to prison
      • hn_throwaway_99 5y ago
        Exactly. Many of her ideas are physically impossible because there is good evidence capillary blood isn't homogeneous enough to give accurate results for quantitative tests at the volumes Holmes was touting.
    • lighttower 5y ago
      Underrated comment. The investors were investing in her because she was willing to take the risk of move fast and break things (where things in this case is the diagnostic accuracy of blood tests). She got nailed, ironically, not for hurting patients, but instead for harming the egos of the investors. As a participant in the startup investment world you are willing Participant of SUSPENSION OF DISBELIEF. This is roughly equivalent speak for REALITY DISTORTION FIELD. The point is you as an investor are a willing participant in believing that something more is possible than what has already been achieved. If you're a founder: you should be worried about being held to a legal standard of the representations and warranties. That section is in every share purchase agreement and it's the stuff that gets you sued. And sometimes, like in this case, it's WIRE FRAUD and it's criminal. Crazy. We need another section to replace REPS AND WARRANTIES.
      • neom 5y ago
        > We need another section to replace REPS AND WARRANTIES Ain't that the truth. Hand on heart: the number of decks I saw last year that have an INSANE 2 page legal disclaimer at the start AND finish of the deck is up ~90%, ninety percent. I knew people who used this as a signal of an inexperienced founder, over night it's the signal of an experienced founder.
    • blackoil 5y ago
      Are there any public example of the claims you are making?
  • paxys 5y ago
    A pivot wasn't necessary. She could have avoided it by recognizing when the writing was on the wall for the company and working towards a graceful shutdown rather than doubling and tripling down on their failures.
    • mkl 5y ago
      That still would have cost investors most of their investment, and probably would have led to this same conspiracy and fraud outcome, since she lied to them to get their funding well before the company shut down. Maybe she could have afforded a bigger/better legal team that way though?
  • chansiky 5y ago
    Based on what one of the engineers of edison were saying, if they could acquire more than a "drop of blood" for analysis, they would have been able to get more accurate results. You might be able to consider that a pivot, since she had been saying "drop of blood" the whole time. It was Holmes' unwavering attitude to imitate Steve Jobs that got in the way of her decisions, and I think more than a pivot of product, that a pivot away from this ideology could have saved Theranos. Willingness to give up on perfect design in order to acquire a working engineered product could have made a world of a difference.
  • bootlooped 5y ago
    She did sort of try to pivot. https://www.wired.com/2016/08/theranos-chance-clear-name-instead-tried-pivot/ https://www.wired.com/2016/08/theranos-chance-clear-name-ins...
• peter_retief 5y ago
  I would like to buy Theranos, it is a great concept and will be possible in the future. How much do they want for the company?
• ramesh31 5y ago
  If she gets anything less than life in prison, it will effectively answer the question of "how many years of prison would you do for a billion dollars?". I'm guessing an absolute max of 5 in a minimum security white collar facility.
  • rrdharan 5y ago
    She didn’t personally clear or keep anything close to a billion dollars. It’s true that she was able to live a somewhat lavish, albeit clearly stressful, lifestyle for a while though…
    • rStar 5y ago
    • hnarayanan 5y ago
      Like a dozen years!!
• cryptica 5y ago
  Kind of interesting how she attends court without any makeup and with scruffy hair; she looks unrecognizable. I guess this is done intentionally to distance herself from her previous identity and also her crimes.
• habanany 5y ago
• NikolaeVarius 5y ago
  Count one of conspiring to commit wire fraud against investors in Theranos between 2010 and 2015: Guilty. Count two of conspiring to commit wire fraud against patients who paid for Theranos’s blood testing services between 2013 and 2016: Not guilty. Count three of wire fraud in connection with a wire transfer of $99,990 on or about Dec. 30, 2013: No verdict. Count four of wire fraud in connection with a wire transfer of $5,349,900 on or about Dec. 31, 2013: No verdict. Count five of wire fraud in connection with a wire transfer of $4,875,000 on or about Dec. 31, 2013: No verdict. Count six of wire fraud in connection with a wire transfer of $38,336,632 on or about Feb. 6, 2014: Guilty. Count seven of wire fraud in connection with a wire transfer of $99,999,984 on or about Oct. 31, 2014:Guilty. Count eight of wire fraud in connection with a wire transfer of $5,999,997 on or about Oct. 31, 2014: Guilty. Count nine was dropped. Count 10 of wire fraud in connection with a patient’s laboratory blood test results on or about May 11, 2015: Not guilty. Count 11 of wire fraud in connection with a patient’s laboratory blood test results on or about May 16, 2015: Not guilty. Count 12 of wire fraud in connection with a wire transfer of $1,126,661 on or about Aug. 3, 2015: Not guilty.
  • klohto 5y ago
    These are big wins! Some huge sums up there. How many years is she looking at?
    • NikolaeVarius 5y ago
      20 years per count
      • Symmetry 5y ago
        That's the maximum possible the judge could decide to give. It bears little relationship to what the federal sentencing guidelines will actually suggest or the judge will deliver. https://www.popehat.com/2013/02/05/crime-whale-sushi-sentence-eleventy-million-years/ https://www.popehat.com/2013/02/05/crime-whale-sushi-sentenc...
    • Ostrogodsky 5y ago
• zinekeller 5y ago
  CNBC says that "Jury finds Theranos founder Elizabeth Holmes guilty on four charges in criminal fraud trial" while confirming that there's deadlock in three charges: https://www.cnbc.com/2022/01/03/jurors-in-holmes-trial-remain-deadlocked-on-three-of-11-fraud-counts.html https://www.cnbc.com/2022/01/03/jurors-in-holmes-trial-remai...
• dbcooper 5y ago
  More complete summary from the NY Times: https://www.nytimes.com/live/2022/01/03/technology/elizabeth-holmes-trial-verdict#count-by-count-heres-what-jurors-decided-on-elizabeth-holmes https://www.nytimes.com/live/2022/01/03/technology/elizabeth... https://news.ycombinator.com/item?id=29789074 https://news.ycombinator.com/item?id=29789074
  • lotsofpulp 5y ago
    > Very little is known of Mr. Balwani, including why he is called “Sunny.” This might be because Saturday in Hindi and other Indian languages is “sunny-var”, and the day of the week you are born on is a common nickname, in conjunction with “sunny” being an easy to pronounce and common English word.
    • secondaryacct 5y ago
      And you d expect they d ask a random Indian in the street just it case, as you seem to say, this would be so trivial people dont feel the need to explain it.
      • kadoban 5y ago
        It's usually against the style of news orgs like the NYT to guess at things like that, or go from general knowledge that may or may not apply.
        • lotsofpulp 5y ago
          Yes, I was just posting in a “fun fact” way. I have no idea if that is the real reason, and I doubt it is worth investigating .
          • secondaryacct 5y ago
            Well I admit I also never understood the sunny nickname and I liked your explanation. Ofc I didnt counter check either hehe
• deleted 5y ago
  [deleted]
• xqcgrek2 5y ago
  How much time is she looking at?
  • zinekeller 5y ago
    NO formal sentencing by Judge Davila yet, including the length of imprisonment and fines (technically the judge can overturn a jury-declared guilt, however it's very unlikely here). ("U.S. District Court Judge Edward Davila will sentence Holmes at a later date.", according to CNBC.)
    • joebob42 5y ago
      Would be curious to here a law-person speculate even if it's just a guess.
  • busymom0 5y ago
    Not sure but I would be interested in knowing how many years people think she deserves?
    • black_13 5y ago
    • rectang 5y ago
      https://www.mercurynews.com/2020/01/14/elizabeth-holmes-theranos-case-feds-claim-patient-harms-related-to-hiv-pregnancy/ https://www.mercurynews.com/2020/01/14/elizabeth-holmes-ther... > On Monday, U.S. Department of Justice attorneys responded. “Thousands of patients received unreliable blood tests, depriving them of money or property, placing their health at risk and, in many cases, causing actual harm,” prosecutors alleged in a filing in U.S. district court in San Jose. Considering the vast weight of the harms she caused, in a "fair" retributive justice system, she would get far worse the sentences routinely doled out to typical criminals. But the US "justice system" is hardly "fair". Personally, I don't really believe in retributive justice. The light sentences afforded to privileged criminals bother me, but what bothers me more are the draconian sentences received by those of less privilege.
• paulpauper 5y ago
  A $100 million wire transfer. Is this literally how people invest in start-ups, just wiring huge sums of money to someone they do not know , on a promise/hope. that just seems so reckless on so many levels
  • drfuchs 5y ago
    Hey, minus the $16 wire-transfer fee. Fair is fair; that’s what I pay, too.
    • brianwawok 5y ago
      I laughed at that. Apparently the wire transfer fee part is the money is free and clear!!!
    • s1artibartfast 5y ago
      Legal firms for investment often take a 1-2% fee for contract work and running the deal. I wonder if the $16 came out of their cut
  • wmf 5y ago
    Nobody invests large amounts in someone they do not know; that's why connections and introductions were a key element of the case.
  • andrewxdiamond 5y ago
    There is usually a contract stipulating details, but yes, VCs tend to use banks
  • celticninja 5y ago
    There are lawyers and contracts involved. There are people who connect the money and the startup,these guys have relationships with the money people so there is trust at that level, but lawyers for the rest of it.
  • missedthecue 5y ago
    Would you prefer they deliver it in cash? There are associated legal docs you sign, but other than that it's not super complicated.
• zxexz 5y ago
  It looks like Balwani's trial is scheduled for next year - is there any reason why they would have the two trials so far apart? Is this common in cases such as these?
  • celticninja 5y ago
    One reason is that if this trial ended in not guilty on all counts they would be unlikely to prosecute a successful case against Balwani. they have a stronger hand now and Balwani may choose a plea deal before trial now, which the prosecution may accept due to today's result.
  • jen20 5y ago
    I was under the impression that it was set for February of _this_ year (2022) per [1]? [1]: https://www.bloomberg.com/news/articles/2021-12-14/balwani-s-theranos-fraud-trial-delayed-as-holmes-fight-drags-on https://www.bloomberg.com/news/articles/2021-12-14/balwani-s...
    • zxexz 5y ago
      Ah, looks like they updated the OP article as well - this makes more sense!
  • paxys 5y ago
    They were initially meant to be tried together, but Holmes' legal team requested a separate trial because part of their strategy was to portray her as abused and controlled by Balwani and shift the blame on him. His trial is to start a few weeks from now.
• VWWHFSfQ 5y ago
  So she was found guilty on 4 charges. Not guilty on 4 charges. And no verdict on the remaining 3 charges. So does she have to get another trial on the remaining 3?
  • gpm 5y ago
    Not an expert, but I believe no verdict usually means "not guilty but the prosecutor can try again if they want to". Considering she was found guilty on 4, it's not obvious that they will bother.
    • rossdavidh 5y ago
      I wonder if they get to hear what the sentence is before they decide on the remaining 3?
• sharkweek 5y ago
  This will sound weird but I am a collector of swag from large companies that have collapsed due to anything from mismanagement to outright fraud. While we're a rare breed there are others like me out there. Still, even with this oddly specific marketplace being small, let me tell you, the Theranos swag market is hot right now (check eBay if you're curious). Wish I had gone big on this one earlier, because I have a feeling this verdict is going to spice things up in the short term. All that to be said, if you've got any authentic Theranos gear hiding in storage please do let me know, I'm a motivated buyer. For those curious as one example: Nothing raises a few eyebrows more than a note written on Lehman Brothers letterhead with a Purdue Pharma OxyContin pen with the dosage pullout.
  • whatever1 5y ago
    Do you have the epic ENRON intern Tshirt in your collection ?
    • AdamN 5y ago
      Why not a stock certificate :-) https://www.apmex.com/product/50847/enron-corp-stock-certificate https://www.apmex.com/product/50847/enron-corp-stock-certifi...
      • dmix 5y ago
        Only 3 left in stock! Also I love that website. As a recent casual collector of paper currency. I never thought to buy some old stocks/bonds. Edit: it’d be hilarious I’d the Enron stock was fake
    • systemvoltage 5y ago
      My intern job back in 2005 was to take Enron's wind turbine division's technical handbooks and scan them on large flat bed scanners. They were all stored in Tehachapi desert, flooded and with water damage. I found a bunch of cool stuff in these boxes including a binder containing Enron's branding assets and standards manual.
  • civilized 5y ago
• petilon 5y ago
  Some founders "fake it till you make it", and this news should serve as a cautionary tale.
  • r00fus 5y ago
    Faking it doesn't work if you are committing fraud?
    • Overtonwindow 5y ago
      I think that's the key point here. Was Jucero fraud? I think there's a clear line between a) we have an idea for a product but we have certain limitations that are feasible to overcome, with more time and investment; versus b) we have a product, we're using it in the field, patients are using it, and it works great. In the first scenario, you could fake the dream but you're not promising something that you know to be absolutely false.
    • throwawaylinux 5y ago
  • Waterluvian 5y ago
    The sociopaths who are attracted to founder life are immune to this lesson.
    • ShamelessC 5y ago
    • every 5y ago
      She strikes me as the cute blonde version of Orson Welles in The Third Man...
  • analog31 5y ago
    I could almost see "fake it til you make it" if your idea is based on already proven technology, but success depends on something like brand recognition, network effect, etc. In the case of Theranos, whether her technology worked or not was ultimately going to be decided by Mother Nature, not by a market.
• Carlee 5y ago
  Can someone share some light on what's covered in the wire transfers?
• Apocryphon 5y ago
  Looking forward to JLaw's portrayal of Holmes in Adam McKay's Apple Studios adaptation of Bad Blood. Hope they pick up from where the book ended and cover this trial. https://variety.com/2021/film/news/jennifer-lawrence-elizabeth-holmes-apple-adam-mckay-1235128044/ https://variety.com/2021/film/news/jennifer-lawrence-elizabe...
  • celticninja 5y ago
    JLaw?
    • cercatrova 5y ago
      Jennifer Lawrence
    • robertakarobin 5y ago
      JLaw == Jennifer Lawrence
      • csours 5y ago
        I wish to god it was Jude Law though.
    • deleted 5y ago
      [deleted]
    • deleted 5y ago
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  • paxys 5y ago
    That project has been in the works for many years now, and is no closer to seeing the light of day. Hulu's miniseries 'The Dropout', with Amanda Seyfried, debuts in March though.
    • Apocryphon 5y ago
      Maybe they're closer to it now that they've just successfully released another movie on another streaming service.
• jonwachob91 5y ago
  It blows my mind that she was found guilty for defrauding investors, but not guilty for defrauding patients about their test results. Investors know that every dollar they put into a company could disappear, it's why startups get capital from investors and not bank loans. But a patient does not expect for their blood test results to be completely wrong. Her tests weren't giving false-negatives or false-positives, they were using lab techniques that we have known to be inaccurate for decades. She knowingly sold Walgreens on 1 test, and then performed a different test. I need to sit down and properly inform myself about how the prosecutors fucked that up so badly.
  • bee_rider 5y ago
    Is this actually the end of her legal trouble? I assumed they were pushing the financial stuff because it is relatively easy to prove, and would go after her for more serious medical crimes over time.
  • danjac 5y ago
    It's a bit like Al Capone being done for tax evasion rather than murder - you convict them on the charges that have the most evidence and are likely to stand up in court, even if they are lesser charges from a criminal and moral standpoint.
  • stock_toaster 5y ago
    > It blows my mind that she was found guilty for defrauding investors, but not guilty for defrauding patients about their test results. Not excusing it, but maybe it was a company vs personal thing (eg. consumer harm perhaps didn't pierce the corporate veil[1]). Whereas Fraud against investors is much more of a personal/individual thing. [1]: https://www.law.cornell.edu/wex/piercing_the_corporate_veil https://www.law.cornell.edu/wex/piercing_the_corporate_veil
    • rectang 5y ago
      In other words, successful "fraud laundering".
  • 5y ago
• wombatmobile 5y ago
  > Holmes was the poster child of Silicone Valley hubris Holmes was convicted of fraud, which is a crime. If hubris was a crime, the meek would inherit the earth, and Silicone Valley real estate would be affordable.
  • deleted 5y ago
    [deleted]
  • cmckn 5y ago
    It’s Silicon.
    • celticninja 5y ago
      I prefer SillyCon
    • MarkMc 5y ago
      Silicone Valley is in LA ;)
  • deleted 5y ago
    [deleted]
  • holografix 5y ago
    Let’s not confuse arrogance with strength. Plenty of royalty lost their heads based on that assumption.
    • Siira 5y ago
      And I’m sure an order of magnitude more didn’t lose their head based on that assumption.
• wnevets 5y ago
• tptacek 5y ago
  Time to kibitz on the likely sentence! You can get the federal sentencing guidelines here: https://www.ussc.gov/sites/default/files/pdf/guidelines-manual/2015/GLMFull.pdf https://www.ussc.gov/sites/default/files/pdf/guidelines-manu... They're long and mostly not relevant except for the sections pertaining to Holmes conduct. Here's the indictment: https://www.justice.gov/usao-ndca/page/file/1135066/download https://www.justice.gov/usao-ndca/page/file/1135066/download Holmes was found guilty of one 18 USC 1349 charge, and 3 18 USC 1343 charges; the 1343's she was found guilty on were in amounts ranging from $100k to $100MM(!). It should be possible to come up with a better guess than the New York Times' "20 years per count, but likely served concurrently".
  • avirut 5y ago
    Does multiple counts served concurrently mean that the effective sentence is just the longest individual sentence? Also: I'm seeing from various websites that the maximum time-left-to-serve for minimum security (federal prison camp) is 10 years, but nothing definitive - [1] is the most in-depth but only specifies this requirement for male prisoners, whereas other requirements are clearly distinguished between male and female. [1] https://alanellis.com/securing-favorable-federal-prison-placement/ https://alanellis.com/securing-favorable-federal-prison-plac...
    • btmiller 5y ago
      Look, she is a snake, but if Python can’t have true parallelism, neither should she :P
    • tptacek 5y ago
      Yes, the guidelines are kind of explicit about this for basic economic crimes. Ken White's the lawyer, though, not me! They're actually even more specific for fraud cases, beyond the general 2B1.1 basic economic crime rule of sentencing according to the most severe count; for fraud, you apparently sum up all the losses from all the counts, which has the net effect of bumping Holmes up 2 additional levels.
      • 5y ago
• Overtonwindow 5y ago
  I'm genuinely surprised. I thought after seven days it would be deadlocked on everything, particularly being silicon valley, successful, beautiful woman, I just didn't have a lot of faith in the jury. I guess this is a very mixed verdict.
• olliej 5y ago
  So… just defrauding the rich investors, nothing on the people who’s blood she claimed to be testing.
  • adventured 5y ago
    She didn't significantly injure those people - she misled consumers about the technology but not the results. They did the actual testing on other legitimate machines. The wire fraud charges were by far the much better target.
    • olliej 5y ago
      They used legitimate machines, but were among other things watering down the samples and using lower volumes of blood than necessary for correct and accurate operation.
  • rossdavidh 5y ago
    The fraud was easier to pin on Holmes as a person, rather than Theranos as a company.
• rvz 5y ago
  It has been definitively admitted. Now we see the vultures tearing this fraudster apart and you what? That is good, and it is absolutely magnificent. Since many have gotten away with it, She is now the first of many that have been caught and need to be investigated and the other exit scams of this decade to be unveiled before the scammers race to the exit with a mountain of cash. So who is next?
  • celticninja 5y ago
    If the global economy doesn't pick up soon we may see many more exposed. But next up I think wi be the Wirecard trial in Germany, if they find someone to prosecute
    • globalise83 5y ago
      They have Markus Braun, ex-CEO, in 'Untersuchungshaft' / on remand in Augsburg, near Munich. He has been there for 1.5 years and will probably be prosecuted this year. In addition, around 30 Wirecard associates are being investigated[0]. Of course The One That Got Away, and likely prime instigator, Jan Marsalek, is oresently in an unknown location with a lot of money on his hands. [0] https://www.tagesschau.de/wirtschaft/unternehmen/wirecard-chef-braun-haft-101.html https://www.tagesschau.de/wirtschaft/unternehmen/wirecard-ch...
      • celticninja 5y ago
        It was Jan Marsalek I was meaning, thank you for the information. If going into hiding is your response to the issue then you must be pretty sure of your own guilt.
• fnord77 5y ago
  why are the charges "wire fraud" and not just "defrauding investors" ? is there some technicality at play here?
  • bluishgreen 5y ago
    Yes, In order to invoke federal jurisdiction the SEC uses the fact that they communicated beyond state lines over the wire. This is why all the charges are called wire fraud. Relevant: https://www.law.cornell.edu/wex/commerce_clause https://www.law.cornell.edu/wex/commerce_clause
    • fnord77 5y ago
      so if she only dealt with california investors, this trial wouldn't be happening?
      • greenyoda 5y ago
        Then she could be prosecuted by the State of California, for violation of state fraud laws.
        • notch656a 5y ago
          Basically everything is interstate commerce. See Wickard v Filburn. It's why growing your own pot or making your own machine gun earns you federal jail time, even if they never enter commerce or leave the state. Basically whether commerce leaves state lines means nothing in terms of whether there is interstate commerce; even growing your own crops to feed to your own animals is considered interstate commerce. Whether a wire left the state means dick to whether the federal government has constitutional authority over it, per supreme court.
          • greenyoda 5y ago
            > See Wickard v Filburn Interesting case, thanks. Here's a link if someone else is interested: https://en.wikipedia.org/wiki/Wickard_v._Filburn https://en.wikipedia.org/wiki/Wickard_v._Filburn
• manaman 5y ago
  From a quick look, no patients were harmed? Am I missing something?
  • Bellend 5y ago
    EH took money from idiots and lost it all. Elon Musk is next only he took the idiots monopoly shares and converted it into actual fiat.
  • deleted 5y ago
    [deleted]
  • mindracer 5y ago
    I think something like a million results were voided as they’re were deemed unreliable. I don’t know if that put anyone at risk though
• paxys 5y ago
  Guilty of taking a billion+ dollars from rich and influential people who couldn't bother to do the bare minimum due diligence into their investments due to greed and FOMO. Not guilty of endangering thousands of lives by running fraudulent and inaccurate tests under sub-par lab conditions. Our justice system is such a farce.
  • nemo44x 5y ago
    Our justice system works well. You are confusing your own emotional feelings for what you would have liked to see with the reality of what was able to be proven without reasonable doubt. The type of populist mob justice you allude* to is not just at all. *(Fixed grammar error specified below)
    • philosopher1234 5y ago
      If “proven beyond a reasonable doubt” keeps leading to bad outcomes, maybe that’s not the right standard.
      • s1artibartfast 5y ago
        That is a dangerous precedent to remove. Certainly we don't want to replace judges and juries with Twitter polls.
        • philosopher1234 5y ago
          Sure, but if the precedent isn’t generating justice, then it’s worth considering alternatives. There is no holy scripture which says proof beyond a reasonable doubt is the correct way to run a justice system.
          • s1artibartfast 5y ago
            If you can't prove they are guilty, how do you know it isn't generating justice? If not here where would you rather draw the line? Incarcerate 1 more innocents s that 1 more guilty makes it into jail? We could have a more likely than not standard of 51% chance like civil law, and 49% of inmates are innocent. Would you personally really want to send someone to prison if you had reasonable doubts of their guilt?
• duxup 5y ago
  What always amazed me is they had nothing… nothing that could do the thing they claimed. To the point they used competitors machines to produce results. Pretty amazing.
  • dvhh 5y ago
    And a lot of people believed it. Pouring billions into something into empty promises.
  • manquer 5y ago
    While it is unusual for the med tech industry, isnt it what startups do all the time ? it is not that surprising to me . It is not pure SaaS companies either, in the EV/self-driving space we have outright frauds like Nikola rolled a truck downhill to make the video and were public at $8 Billion. Others like Rivian/ tuSimple are definitely are not going to meet the projections in sales and plans they have published. Tesla constantly says a lot of things they never delivery or deliver much later than promised.
    • dboreham 5y ago
      > isnt it what startups do all the time ? All the time? No.
      • manquer 5y ago
        Is this pedantic correction as in you would not comment had I said "most" of the time or do you mean to imply it is rare/uncommon/ unusual for startups to do so ?
        • khazhoux 5y ago
          Startups do NOT regularly re-package other companies' deliverables as their own, and especially not to cover for the fact that they've promised the impossible.
    • duxup 5y ago
• rajacombinator 5y ago
  All the VCs should be held complicit as well.
  • space_rock 5y ago
    Why? Is there evidence that were in on the criminal conspiracy? All I've heard it they were victims of it
  • dehrmann 5y ago
    For letting themselves be defrauded?
    • space_rock 5y ago
      Yes. How dare you be a victim of a crime
• chaxor 5y ago
  It's interesting that it took so long for this to finally be resolved, such that now - the technological goals that they had may actually be surmountable soon. I wonder what Theranos 2.0 will be called when it cross up in a few years. FBhealth ? BioBezosBot ? AppleSeq ? GoogleBlood ? NetStix ?
  • usrusr 5y ago
    If they can really pull it off, "Lizzy H". If you can do something that previously was strictly in the realm of magic, name your company after a famous magician.
• deleted 5y ago
  [deleted]
• rgdsmtn 5y ago
  Federal law can't regulate commerce unless it's interstate commerce. So the wire in the wire fraud part is the handy jurisdiction claw so that this is prosecuted by SEC.
  • notch656a 5y ago
    Wickard v Filburn would have a word with you. It's why intrastate drug sales or making your own machine gun still spells federal jail time. The federal government has decided basically anything involving producing/consuming/possessing goods, even for your own consumption in state never entering commerce, is interstate commerce.
• beebmam 5y ago
  Sending fraudulent people to jail for a long, long time is fundamental to running a healthy society. One of the reasons the US is a decent place to live compared to other countries is because we actually prosecute frauds and criminals here. Let's start seeing some other countries around the world start doing this, like India, Russia, and China. My 80 year old mother was recently tricked into wiring money by Indian scammers threatening her. I'm really sick of this shit.
  • user_7832 5y ago
    > One of the reasons the US is a decent place to live compared to other countries is because we actually prosecute frauds and criminals here. Let's start seeing some other countries around the world start doing this, like India, Russia, and China. I'm really not sure fraud is the biggest issue plaguing these countries... corruption is definitely an issue (though the US has in some cases legalized it into lobbying and PACs and the like). It's great that people doing scummy things are held accountable, but are the Sa cklers of Purdue P harma in prison? They've (unarguably) hurt and killed way more than Holmes did, but where's justice for that?
    • shoulderfake 5y ago
      How many wall st honchos went to jail for the subprime mortgage crash ?
    • refurb 5y ago
      Nobody said the US system was perfect, just better (along with other developed countries that have rule of law). I lived in a developing country for a while and the corruption can be maddening. You might agree to partner with someone to buy property, they take your money and cut you out. In corrupt countries, you might be entirely screwed - that person has too many connections and influence, nobody will touch them. At least in countries with rule of law you could sue them. You might not win or be made whole, but at least there is a system that is somewhat dependable.
      • user_7832 5y ago
• thyrox 5y ago
  Sorry this is for my own curiosity because I know nothing about US legal system, but I was watching this documentary recently about Bikram Choudhury, a yoga guru who was being prosecuted for several sex crimes and also had an arrest warrant issued against him. But in the documentary he successfully managed flee to Thailand then Mexico. They even managed to track him but he just said fuck off and that was that. Did not face any jail time and now he is back to conducting his Yoga sessions. My point is what stopped Elizabeth Holmes from doing something like this? She surely knew what was coming her way and she is kinda unscrupulous too, so why didn't she run?
  • ctchocula 5y ago
    Many countries have extradition treaties with the US. It's likely that due to how much more high-profile Theranos case has been, that the US would have expended more resources tracking her down compared to the yoga guru. Plus she would have had to spend the rest of her life on the run and find a country (e.g. Russia? Cuba? Venezuela?) to grant her asylum. No normal person would want to try either of the above, much less someone born with a silver spoon in their mouth.
• holografix 5y ago
  It’s fascinating, albeit useless as it’s all speculation, to consider Holmes’ mentality and tactics. As a young and attractive woman she carefully manicured her appearance to resemble Steve Jobs and consistently altered her tone of voice (!) to sound deeper. To investors she was the disarmingly beautiful genius. These old grey men should be so lucky as to get her attention and be part of her myth! To a much older, rich, well connected, megalomaniac controlling man she was the young disciple. Ready to inflate his sense of self by “needing” direction and castigation. Not to mention the sexual dynamic. To the jury she’s pregnant mother, victim of a culture that only rewards winning and the fragile, abused partner of an abusive man. She never meant any of it, it’s all a big misunderstanding! Neumann has nothing on Holmes!
  • deleted 5y ago
    [deleted]
  • stareblinkstare 5y ago
• MarkMc 5y ago
  Someone mentioned that Holmes will likely get a relatively light sentence because she is an attractive white woman. I've read there is good evidence that black people get harsher sentences than white people and men get harsher sentences than women, other factors being equal. I suspect there is also evidence attractive people get lighter sentences than ugly people. The current system seems like a clear-cut violation of the US constitution's Equal Protection clause. So why doesn't an organisation like the ACLU take legal action to force all sentencing to be done by a judge who is unaware of the race, sex and attractiveness of the defendant?
  • cmckn 5y ago
    Probably wise to avoid postulating until she is actually sentenced.
  • pvg 5y ago
    Because there's a sixth as well as a fourteenth amendment
    • jasonfarnon 5y ago
      what's the relevance of those amendments? are you misreading the right to confrontation?
  • manquer 5y ago
    First Equal Protection clause from the 14th Amendment applies to only states and not federally. [1] Second, It is extremely hard to prove that discrimination happens while all other things are equal . Rarely all other things are also equal as there are many strongly correlated factors with race[2] that can adversely impact conviction, for example being black on average would be poorer and would more have a court appointed attorney who is looking to close a case(given his load) rather than win for each defendant and push a defendant to plea out than go to trial etc. Is this directly because he is black ? Race, age and gender are objectively measurable [3], "attractiveness" is lot more subjective to eyes of the beholder. How do you even come up with a scale for legal purpose of measuring bias like this ? U.S. follows trial by jury, by definition that means the jury of peers are to take the law and your entire specific example and act with full freedom as they see fit ( even nullify laws if they wish to do so). In a such a system there will be biases, because people are inherently biased. While there are some efforts to reduce this, like no all white juries against black defendants etc, unless there is fundamentally different system biases can not be eliminated. The biggest determining factor is Money. Richer you are, less likely to have trouble with law, and get away with a lot. White, young, female and attractive correlates to being rich. Sadly that is how the world works. [1] There are similar protections in the 5th Amendment Due Process Clauses that can be applied at a federal level. [2] Similar examples to other factors as well [3] Race and Gender can have some ambiguity but in most cases it is clear
• TigeriusKirk 5y ago
  The initial HN discussion of Theranos in 2013 https://news.ycombinator.com/item?id=6349349 https://news.ycombinator.com/item?id=6349349
  • rrdharan 5y ago
    Great / prescient comment here: https://news.ycombinator.com/item?id=6349808 https://news.ycombinator.com/item?id=6349808
• rdtwo 5y ago
  Why isn’t she in jail right now? She’s doing at least a few years hopefully the full 80 but probably not.
  • sailingparrot 5y ago
    Sentencing always happens at a later date after conviction to leave time for a post trial hearings so that the defence can raise their concerns etc.
• sidcool 5y ago
  Trevor Milton better be scared. His was a bigger fraud
• fortran77 5y ago
  Good! Now indict the board members and the Stanford professor-consultants.
• csours 5y ago
  I'm reading the jury instructions here: https://cand.uscourts.gov/wp-content/uploads/cases-of-interest/usa-v-holmes-et-al/US-v-Holmes-18-cr-00258-EJD-Dkt-1188-proposed-joint-JI.pdf https://cand.uscourts.gov/wp-content/uploads/cases-of-intere... Would the jury get this document with the blue and yellow highlighting?? > Language proposed by Ms. Holmes, and objected to by the government, is highlighted in blue. Language proposed by the government, and objected to by Ms. Holmes, is highlighted in yellow.
  • neom 5y ago
    The Lawyer You Know broke it down pretty well: https://www.youtube.com/watch?v=45FzkrUjh_4 https://www.youtube.com/watch?v=45FzkrUjh_4 (but no, what you linked are a conference hearing preliminary proposed instructions for parties objections)
• madrox 5y ago
  Looking at the Theranos comment history on HN is a journey [1]. From the very beginning there was a lot of skepticism. [1] https://hn.algolia.com/?dateRange=all&page=30&prefix=false&query=theranos&sort=byDate&type=story https://hn.algolia.com/?dateRange=all&page=30&prefix=false&q...
  • reidjs 5y ago
    One interesting find from that search, here’s two videos of Holmes, in the first she fakes a creepy deep voice for the entirety of the interview https://www.youtube.com/watch?v=YecjzEScXqU&t=105 https://www.youtube.com/watch?v=YecjzEScXqU&t=105 In this video she is being interviewed on Mad Money, using her (assumed) actual voice. https://www.youtube.com/watch?v=rGfaJZAdfNE&t=403 https://www.youtube.com/watch?v=rGfaJZAdfNE&t=403 What a strange person.
    • Andrew_nenakhov 5y ago
      I never could understand why people pay so much attention to her voice. It's not that deep, I've known plenty of females with voice deeper than what you call 'creepy deep voice'. Such voice is not that rare and definitely not creepy, just voice. Also some throat infections can temporarily make the voice lower.
      • globular-toast 5y ago
        It's not about how deep it is. It's about it being fake.
• hffft 5y ago
• rTX5CMRXIfFG 5y ago
  These days, whenever someone is being presented as an absolute villain (as in the case of Holmes), comments sections tend to have not a few posts about how the things they’ve done, from a different vantage point, are understandable, or morally ambiguous and not objectively evil, or even amoral. I’m completely opposed to what she has done, but could there be any reason why we all seem to be unanimous that she is objectively evil?
  • acdanger 5y ago
    Yes
  • dkjaudyeqooe 5y ago
    The evidence. I don't think it's any sort of prejudice (sexism, high flyer, etc), her behaviour seems to speak for itself.
  • selfhifive 5y ago
    Because she messed with the financial life and physical life of people. Also she used the enthusiasm shared by people who like to advance technology to manipulate people which is a grave sin for the kind of audience you'll find here.
  • tootie 5y ago
    Her main excuse is that she was manipulated by her COO but it seems unlikely. As evil as defrauding investors can be she was it. She also seemed pretty comfortable scamming medical techs and patients. There's just no way she didn't know she was selling snake oil. Maybe she started out with pure wishful thinking that if she talked enough she could will her device into existence but once it started actually testing blood it was way past the line. She was the CEO, she knew it was fake technology, she lied at every opportunity.
    • iscrewyou 5y ago
      Exactly. Anybody can be making a company and say they haven’t done it yet but are making progress. She said it works and that was a lie. A lie that affect lives and economics of rich and poor alike. Bad combination.
• 666lumberjack 5y ago
  Beta on how long it is before Elon Musk is in the same position?
• mullsie 5y ago
• nerevarthelame 5y ago
  Here's the earliest HN submission I could find on Theranos: https://news.ycombinator.com/item?id=6349349 https://news.ycombinator.com/item?id=6349349 I don't really blame folks for not calling it out as a fraud at that point, given how little information we had. There were, for what it's worth, a number of people who complained about the ambiguity of the website. But many were convinced that the illustrious board must mean good results. Well done to medman77 who had the most direct rebuke: "The company is all hot air. They have a board full of retired military figure heads that have no experience in medical devices or retail services. Additionally, they do not have any products to show. Look at their patents. They are all very general and broad. There has been NO FDA CLEARANCE for anything they are doing, which raises legal questions. Speaking of legal, search for lawsuits they are involved in. Their core technology is not even theirs. They stole it from someone else."
  • hooande 5y ago
    this old thread is so hn. lots of discussion about famous names on the board, mentions of threats to privacy and discussion of the website ui. medman77 did crush it with actual technical analysis, among others. now I want to go back and see what hn said about other famous companies
    • lotsofpulp 5y ago
      I recall lots of doubt about Theranos from the beginning, especially due to the board composition.
      • throwawaylinux 5y ago
        I also recall a lot of bullishness especially due to the board. The idea of getting in on war profiteering and inflated government contracts made a lot of mouths water.
      • sk5t 5y ago
        There was also a lot of scientific doubt about Theranos based on what is actually physically present in a drop of capillary blood.
• bg117 5y ago
  I remember my ex Manager who was from MIT taking the name of Theranos before it was in the news for all things bad and how they are revolutionizing healthcare. Looks like hype is how the whole thing is depending on.
• joelbondurant1 5y ago
• madiator 5y ago
  In case you haven't read already, I highly recommend reading Bad Blood.
• ck2 5y ago
  This was a theranos pricing sheet https://i.imgur.com/ukWZMDn.png https://i.imgur.com/ukWZMDn.png If only it was reality and we might never have that pricing Compare to labtestingapi.com which is the cheapest quest reseller, $20 vitamin D test vs $52 https://www.labtestingapi.com/product/questassured-25-hydroxyvitamin-d-d2-d3-lcmsms https://www.labtestingapi.com/product/questassured-25-hydrox... $10 B12 vs $39, etc. The biggest crime she committed was ending any chance at a startup with affordable pricing in the future, no-one would believe/invest so now we are back to a duopoly in the USA (quest vs labcorp) Maybe in a decade, or two, we'll have our own mini-lab in a box in our homes for outselves and pets, maybe it will be on a subscription pay-per-month software model, maybe 100 years we'll have it on our phones like a tricorder.
• chrononaut 5y ago
  For those wanting to see the Theranos story as it unfolded from HN's perspective, here's a summary of some of the major threads over the years until early 2016: - 2013/09/08 - Theranos (theranos.com): https://news.ycombinator.com/item?id=6349349 https://news.ycombinator.com/item?id=6349349 (113 comments) - 2014/06/26 - This CEO is out for blood (fortune.com): https://news.ycombinator.com/item?id=7951019 https://news.ycombinator.com/item?id=7951019 (97 comments) - 2015/04/26 - Scientists skeptical about Theranos blood test (businessinsider.com): https://news.ycombinator.com/item?id=9440595 https://news.ycombinator.com/item?id=9440595 (94 comments) - 2015/07/03 - FDA approves Theranos test for HSV-1 (fortune.com): https://news.ycombinator.com/item?id=9823638 https://news.ycombinator.com/item?id=9823638 (24 comments) - 2015/09/21 - How Playing the Long Game Made Elizabeth Holmes a Billionaire (inc.com) https://news.ycombinator.com/item?id=10252183 https://news.ycombinator.com/item?id=10252183 (82 comments) - 2015/10/15 - Theranos Has Struggled with Blood Tests (wsj.com): https://news.ycombinator.com/item?id=10391313 https://news.ycombinator.com/item?id=10391313 (87 comments) - 2015/10/16 - Theranos Dials Back Lab Tests at FDA's Behest (wsj.com): https://news.ycombinator.com/item?id=10397149 https://news.ycombinator.com/item?id=10397149 (86 comments) - 2015/10/18 - Theranos Trouble: A First Person Account (mondaynote.com): https://news.ycombinator.com/item?id=10408811 https://news.ycombinator.com/item?id=10408811 (45 comments) - 2015/10/27 - Theranos didn't work with the huge drug company it supposedly made money from (theverge.com): https://news.ycombinator.com/item?id=10459905 https://news.ycombinator.com/item?id=10459905 (113 comments) - 2015/10/28 - The FDA's notes from its visit to Theranos' labs don't look good (businessinsider.com): https://news.ycombinator.com/item?id=10462678 https://news.ycombinator.com/item?id=10462678 (97 comments) - 2015/10/29 - Theranos, Facing Criticism, Says It Has Changed Board Structure (nytimes.com): https://news.ycombinator.com/item?id=10471152 https://news.ycombinator.com/item?id=10471152 (65 comments) - 2015/12/20 - "Theranos Founder Faces a Test of Technology, and Reputation" (nytimes.com) https://news.ycombinator.com/item?id=10765562 https://news.ycombinator.com/item?id=10765562 (102 comments) - 2015/12/28 - "At Theranos, Many Strategies and Snags" (wsj.com) https://news.ycombinator.com/item?id=10799261 https://news.ycombinator.com/item?id=10799261 (126 comments) - 2016/01/25 - "Problems Found at Theranos Lab" (wsj.com) https://news.ycombinator.com/item?id=10965167 https://news.ycombinator.com/item?id=10965167 (76 comments) - 2016/01/27 - "The letter the Feds sent to Theranos" (vox-cdn.com) https://news.ycombinator.com/item?id=10983747 https://news.ycombinator.com/item?id=10983747 (192 comments)
• andi999 5y ago
  Could anybody explain why this is wire fraud and not normal fraud?
  • shawabawa3 5y ago
    Wire fraud just means fraud committed using electronic communication. They presumably chose charges of wire fraud as they had evidence of her communications (texts, presentations, recordings) implicating her in fraud
• travelhead 5y ago
  Elizabeth could have saved herself many of these charges by telling investors she was pivoting to using 3rd party testing devices, reducing the number of tests, and transitioning to a business model involving venous blood drawing as a service with lower costs and better branding. Instead, she decided to continue to lie to investors even though she knew her tech didn’t work as she represented.
  • globular-toast 5y ago
    Let's be honest, she probably didn't have a clue what was going on. She just stuck to the narrative which became more and more distant from a reality she could not grasp.
• LongTimeAnon 5y ago
• richardfey 5y ago
  Is 'Theranos' still copyrighted / trademarked, or can it be freely used now?
  • anshumankmr 5y ago
    Who would want to use it?
    • luckystarr 5y ago
      Crypto ransomnists perhaps?
      • anshumankmr 5y ago
        Crypto Ransomnists? What are those? Somebody who install malware and ask for crypto as ransom. Is that it?
        • luckystarr 5y ago
          Yeah. Malware is installed and all your data is encrypted. The ransomnists then demand Bitcoins to decrypt it again. The more revenue you have as a company, the higher the ransom.
    • xdennis 5y ago
      See: https://news.ycombinator.com/item?id=29789279 https://news.ycombinator.com/item?id=29789279
      • anshumankmr 5y ago
        Memorabilia is different from using the brand name. Like I don't imagine we will be seeing a Theranos brand being slapped on medicines anytime soon (or at least that is what I thought the parent comment was asking about). That being said, I would hope the Theranos brand is sold and it assets liquidated to repay every person who had a fraudulent test result.
    • 5y ago
• textcortex 5y ago
  Anyone got suprised?
• causality0 5y ago
  What's the takeaway from this other than "killing people by giving phony medical test results is just fine, but don't you dare anger the wealthy"?
  • afterburner 5y ago
    Did you know they only ever got Al Capone on tax evasion? Would you draw a similar conclusion in that case, or maybe did the effort put into pinning Capone on tax evasion have more to do with how he was running a murderous criminal organization for many years?
    • codeflo 5y ago
      Isn’t Al Capone’s tax evasion conviction usually mentioned as a bit of a joke? I don’t see how anyone can cite it as an example of the system working perfectly fine. Ignoring for a moment that this was in a very different era, to me, there are only two possible conclusions from this: (a) The conviction was legitimate. This means that if only he had been a bit more thorough about laundering his money, he’d have gotten away with organized murder. (b) The conviction was ultimately politically motivated, because it became a public embarrassment that he couldn’t be convicted of anything. But if the state really wants to get rid of someone, a prosecutor will find a way, so they did. And I seriously don’t know which possibility is more frightening.
      • himinlomax 5y ago
        Montesquieu: https://en.wikipedia.org/wiki/Perfect_is_the_enemy_of_good https://en.wikipedia.org/wiki/Perfect_is_the_enemy_of_good
      • notch656a 5y ago
        (b) is far more terrifying. I'd rather 1000 murderers get away than a single case of a prosecutor have that kind of discretionary power to fuck over essentially anyone just for selective enforcement. The law should be applied equally.
      • afterburner 5y ago
• abyssiana 5y ago
  Collectors want some bits of Theranos goods, the croud of compatriots judging woman’s decission to have a child in tough times, the level of hateness is destroying all the metrics. I hope despite all this noice all investors that were sweating their money on politics lies, despite all brainless jodgmental underdogs she will get the minimum punishment.
• peter_retief 5y ago
  I believe what they proposed is possible but they were unable to deliver not being technical founders. If they had been technical founders they would have promised a product that could be delivered. This all besides the ethical issues of faking blood tests!
• cryptica 5y ago
  On one hand, the victims of her scams wanted her guilty, on the other, I suspect that those who are trying to dismantle the judicial branch of government wanted her to be not guilty. Good to see the legal system is holding up.
• rStar 5y ago
• maxcan 5y ago
  DAE remember people dismissing the original critical media coverage as being sexist and just trying to take down a successful woman in tech? Wonder if we'll hear any apologies to those authors..
  • ciabattabread 5y ago
    Are you talking about twitter commenters or news organizations? Provide samples please.
    • henryaj 5y ago
      https://www.nytimes.com/2021/09/15/opinion/elizabeth-holmes-trial-sexism.html https://www.nytimes.com/2021/09/15/opinion/elizabeth-holmes-...
      • chewmieser 5y ago
        That's an opinion piece that still even states "She should be held accountable for her actions as chief executive of Theranos." Are there any actual articles with the message the op is suggesting?
    • maxcan 5y ago
      more twitter commenters, but IIRC some well known ones. TBH, I don't really want to spend the time to go digging through a bunch of twitter searches to find them.
• irthomasthomas 5y ago
  On the subject of lying tech CEOs, will Musk ever pay for his sins? "I feel very confident predicting 1 million autonomous robo-taxis for Tesla next year" - E. Musk 2019 Did he ever atone for this, or is he still kicking the can down the road? Edit: I know, I know... It's not a crime until it is. Let a jury decide if Musk lied, or if he genuinely believed that his company was capable of producing 1 million robotaxis in a year. I would love to know what his staff where telling him that would lead him to this "very confident" prediction.
  • yoelo 5y ago
  • simonsarris 5y ago
    Being wrong about a prediction, even being very wrong, is not the same as lying or defrauding. By 2019 pretty much everyone knows that Musk is a person who makes extremely ambitious predictions, projections, timelines, etc, and tries to meet them. Almost anyone in that situation will have a low hit rate. There's no sin to pay for, this is how he chooses to work and structure his businesses. Investors tend to be very happy with the results. To them, making a large number of ambitious goals and meeting some of them is still very worthwhile. If you want to invest in companies where they make no such predictions, and the CEOs are never wrong, you are welcome to buy GE and follow their CEO on twitter. He has never, ever made a wrong prediction: https://twitter.com/larryculpjr https://twitter.com/larryculpjr
    • loudtieblahblah 5y ago
      But its aimed at Musk so no matter what it's an astute point! /s
    • emptyfile 5y ago
      What about making a prediction while being, as you're saying it, 95% sure its bullshit? Is that not lying? When does it become lying, when you're 100% sure you're not saying the truth?
• evancoop 5y ago
  The relevant detail, in my mind, is not whether Holmes deserves punishment, or even how much. The relevant detail is how the judge ultimately sentences Holmes, and more importantly, on what basis the judge selects the upper or lower range of possible sentencing outcomes. Considering that BS, stretching of capabilities, and so on are commonplace in the startup world, the point isn't whether Holmes crossed the line (she did), but rather, how exactly that line is repositioned by this precedent. There's the easy story: "Young, ambitious wunderkind founder falls from grace." And the hard story: "Here's what might be relevant for future founders."
  • baby 5y ago
    > And the hard story: "Here's what might be relevant for future founders." Honestly, these founders are crap. I met a lot of different types of founders, there are a lot of snake oil sellers out there, and then there are the good ones. I'm willing to bet that nothing good came out of the snake oil sellers.
  • ethbr0 5y ago
    The worst possible outcome of this, and I hope clarification presses this, would be "You can't lie and bend the truth in biology startups, but can everywhere else." Which would effectively siphon money away from an already hard but critical space. The jury found Holmes guilty. But she should have been found just as guilty if she'd been running an adtech startup or a crypto company.
    • snek_case 5y ago
      I don't think it's just about biotech startups. I think the obvious distinction here is that her behavior put lives at risk fairly directly. Theranos was administering blood tests to a large number of people in a beta program. These tests were incomplete and inaccurate. Said tests were used to monitor the status/recurrence of cancers and other conditions like diabetes. If you similarly put people's lives or safety in danger with an AI startup somehow (with enough of a lack of ethics, this might be possible), you too could be eligible to win an all expenses paid vacation.
• thoms_a 5y ago
  Hmmm, I wonder if any Goldman Sachs execs did time for all of the proven fraud they committed, which led to a stock market crash? Nope. They just got bailed out by the Fed, and given bonuses. This is how you know which profession runs the American empire. It sure as hell isn't tech CEOs.
• ferdowsi 5y ago
  I'm loving reading through all of the sickening puff pieces that business/tech journalists put out about her and Theranos. It's funny to think back to 2015 and the hagiographical void still left in tech journo hearts after Steve Jobs died. https://www.inc.com/ilan-mochari/elizabeth-holmes-theranos-icons.html https://www.inc.com/ilan-mochari/elizabeth-holmes-theranos-i... > How Elizabeth Holmes Became America's New Entrepreneurial Icon > She represents the part of entrepreneurship that is long-term dedication, when nobody's watching >... That kind of walk-before-you-talk behavior is refreshing and respectable in today's hype-strewn entrepreneurial landscape.
  • JohnJamesRambo 5y ago
    Gell-Man Amnesia Effect in full effect. Will we remember when we read the next PR piece/pump and dump disguised as journalism?
    • johnebgd 5y ago
      No one in the media seems to still question if cryptocurrencies are serious investment assets despite little actual proven utility beyond being a speculative investment asset.
      • caslon 5y ago
        >Why Cryptocurrency Is A Giant Fraud >Speculators might make money on it, but the arguments for its usefulness fail completely. https://www.currentaffairs.org/2021/04/why-cryptocurrency-is-a-giant-fraud https://www.currentaffairs.org/2021/04/why-cryptocurrency-is... >Bitcoin is the greatest scam in history >It’s a colossal pump-and-dump scheme, the likes of which the world has never seen. https://www.vox.com/2018/4/24/17275202/bitcoin-scam-cryptocurrency-mining-pump-dump-fraud-ico-value https://www.vox.com/2018/4/24/17275202/bitcoin-scam-cryptocu... >The Great Cryptocurrency Scam https://www.forbes.com/sites/jayadkisson/2018/11/20/the-great-cryptocurrency-scam/ https://www.forbes.com/sites/jayadkisson/2018/11/20/the-grea... >Dogecoin Creator Says Crypto Is a Scam >Jackson Palmer went on Twitter for the first time in two years to remind us that the wealthy are ruining everything—even cryptocurrency. https://gizmodo.com/dogecoin-creator-says-crypto-is-a-scam-1847292956 https://gizmodo.com/dogecoin-creator-says-crypto-is-a-scam-1...
• irthomasthomas 5y ago
  "FDA has concluded that the Theranos test and technology is eligible for waiver under CLIA. The waiver means FDA determined the Theranos test and technology is reliable and accurate..." That aged well. https://web.archive.org/web/20160320011355/https://www.theranos.com/news/posts/theranos-receives-clia-waiver-paving-the-way-for-greater-accessibility-of-health-information-at-the-time-and-place-it-matters https://web.archive.org/web/20160320011355/https://www.thera...
  • josho 5y ago
    This exposes the weaknesses in our current system. From the article "Theranos provided data". Science is about reproducibility. Evidently the FDA isn't responsible for reproducing the science from companies and instead takes them at their word. I think it shows that generally speaking our regulatory bodies need to evolve. They need a quality control program that periodically audits the information provided to them and conduct their own independent review/replication of the experiments. If reproducibility isn't possible then severely punish companies that are found to be misrepresenting their data.
• dav_Oz 5y ago
  For somebody unfamiliar on how start-ups on that scale "work", I suppose this edge case offers some valuable insight. I more often than not had a hard time understanding what some well funded start-ups I had contact with are actually up to. From personal accounts of the people involved, the common modus operandi seemed to be "let the money stream not ebb and we will figure something out in the meanwhile" as supposed to "you finally do not have to be preoccupied about the finances and can start focusing on solving the problems at hand". I wonder how efficient the system really is, purely in enabling indivduals to develop their ideas into some form of actualization and even if the "start-up" fails completely on its promise. And also how much room to appreciate the efforts made so one can at least activley learn from mistakes/misconceptions made. Elon Musk is an interesting example as it illustrates that there seems to be a goldilock zone of over the top "predictions", a hypnotic dance with investors and the public: "How long for X taking place?" Aside from his PR, at least he delivers on some actualized forms of engineering feats. As the pendulum swings from government funding to private funding, the high concentration of wealth ("resources to enable") on either side make it prone to that scale of fraud.
• gameswithgo 5y ago
  I wonder what parallels we can draw between Holmes and her blood testing, with Elon and full self driving. I suppose Elon has covered his bases by saying it is still a work in progress while charging for it, but he has also been saying it will be ready in about a year or two since 2016. I think the FSD research Tesla is doing is interesting, but man I would rather all of that money gone into a carbon fiber roof or something on my model 3 instead!
  • thehappypm 5y ago
    Consider the James Webb Space Telescope. Are the engineers working on it frauds because it’s been delayed for years? No, they have legitimately been trying their best despite leadership committing to dates. Theranos would be if JWST took taxpayer dollars and launched a non working telescope and sent back fake images. Tesla with FSD is a lot more like the JWST being delayed, or perhaps if they launched a stripped down version to space and then delayed the real thing.
    • shawabawa3 5y ago
      It depends on whether Tesla/Elon actually believe they can deliver FSD. It would be fraud if internally they knew FSD was not possible on their hardware but they continued advertising that it was (I'm not suggesting this is the case, just saying there is a world where Tesla's FSD claims are fraud)
    • boc 5y ago
      Except the JWST isn't going to fly through my windshield at 80 miles an hour on 280 if it doesn't end up working perfectly.
  • druadh 5y ago
    The progress made on full self driving (FSD) has been quite transparent, at least compared to Theranos. I worked at Tesla from 2017 - 2019 and the quality of Enhanced Autopilot probably quadrupled in the that small amount of time. I left before being able to experience the progress made on FSD, unfortunately. I agree that Elon's timeline's are absolute BS. My perspective on his timelines are that they are almost meant more for his employees (throughout all his companies) to try and shorten the time it takes to 'achieve the impossible'. For example, something that most industry folks would think will take 20-30 years (or is feasibly impossible ie. reusable rockets), Elon gives a 5 year timeline and his team actually gets it done in 10 -- still less time than anyone thought possible. I'm excited to see what kind of progress is made on FSD once the DOJO supercomputer is built out and put to work (another item with an unrealistic timeline, I've no doubt). Just my two cents. Enjoy your Model 3!
• asah 5y ago
  Of course she's guilty and should get a long prison sentence. But is it realistic to assume founders will self-police given the pressures? Or should we expect investors to look at these BIG WARNING SIGNS and do more due diligence??? Seriously, having no subject matter experts on the board etc is ridiculous and all the valley insiders knew it. One call to her thesis advisor is all the due diligence they needed to do. Put another way, is the next Elizabeth Holmes going to be deterred by her prison sentence? Was she deterred by Bernie Madoff or 100s of others? Again obviously they just wanted to nail her on something and didn't have enough evidence for the reason crime, which was lying to end users about their healthcare. And obviously it's illegal and bad and wrong to lie to investors duh. I'm just saying that perhaps we shouldn't use self-policing or the courts to solve the startup-investor-fraud problem because they're (a) ineffective, (b) we have other & better ways to solve this, (c) solution b leads to the more efficient market and therefore the greater innovation and therefore wins.
• qwerty456127 5y ago
  Although I acknowledge the fact of her wrongdoing and that such has to be prosecuted so others would "think twice" before committing a fraud (healthcare-related fraud especially) I, to be sincere, understandably feel zero real anger to her - because the whole thing happened rather far away and didn't affect anybody I know. At the same time I feel genuinely curious about her thoughts and emotions as she unarguably is a formidable lady - scamming so many supposedly smart and competent people obviously requires outstanding logical and emotional intelligence (note emotional intelligence doesn't necessarily imply being good, it means being good at observing, understanding and managing emotions of yourself and others, whatever a purpose, good or evil), understanding of the market, society and people. This makes me sad she herself never wrote a book and if and when she will (perhaps she'll have time for that in the prison) she is hardly going to write anything but "I'm so sorry" bullshit.
• ineedasername 5y ago
  Ironic that her board of directors-- one of the most praised aspects of Theranos-- probably hurt her when it came to going after her with criminal charges. These were some of the most well-connected people in the country, and making them look like fools did her no favors. Once it was clear this wouldn't go away quietly, I'd bet they pushed hard to ensure criminal prosecution. (which I think she deserved anyway.) Especially because it was those same directors' reputations that likely helped the fraud go on so long. There was probably a fair number of skeptics who thought "Surely they wouldn't put their name on something like this if there was nothing there". I doubt Kissinger or the people around him want the last of his legacy to be punctuated by Theranos. I'll be honest: I kind of thought the same thing. That a breakthrough in science of this magnitude with so much silence around its details was strange, especially in the face of some expert skepticism. But the idea that Henry Kissinger etc. would attach themselves to it without compelling evidence made me more or less shrug my shoulders and move on.
  • leroy_masochist 5y ago
    > Once it was clear this wouldn't go away quietly, I'd bet they pushed hard to ensure criminal prosecution. You're saying that Mattis, Cohen, etc had the ability to influence decisions within Trump's DoJ and exerted that ability in order to ensure that charges were filed against Holmes in 2018? If so, why do you think this?
    • MiscIdeaMaker99 5y ago
      Because it sounds like a much better story than what probably really happened.
      • ineedasername 5y ago
        Could be! Because regardless of outside influence, this is the sort of high-profile case that can boost the career of anyone working on prosecution. But I also don't think it's unrealistic or unreasonable to speculate that people who were on the board of directors due to their connections and influence could have used that same influence when things went sour.
• yalogin 5y ago
  I have to say I am a little surprised. I expected her to not be convicted and end up with millions of her scammed money and slowly make her way into the entrepreneurial circle. Glad she is convicted though.
• pers0n 5y ago
  She'll probably get 6 months in jail and then another year on house arrest.
• AlbertCory 5y ago
  Hard sciences are hard. We have it easy in software. That's why her "lesson" from SV entrepeneurs about "fake it til you make it" did not apply. They weren't doing medicine. Revolutionizing an industry where there are already standards, laws, people's health at stake, and government bureaucracies is WAY harder than what most of her heroes did.
• smm11 5y ago
  Zero sympathy from me. I hope she burns. Far, far too many of these charlatans out there. I used to admire many, thinking I wasn't working hard enough, trying enough, so I busted my rear for decades, career-wise and activity-wise. They're all bluffing. Lying. Stealing. Cheating. Eff them all.
• kyleblarson 5y ago
  I hadn't followed Theranos much until the trial but listened to the American Scandal podcast about it. I find the narration to be a bit cheesy but it was pretty informative for just a few hours of listening while exercising: https://podcasts.apple.com/my/podcast/theranos-startup/id1435516849?i=1000534266693 https://podcasts.apple.com/my/podcast/theranos-startup/id143...
  • the_doctah 5y ago
    I can also recommend the book Bad Blood (Carreyrou 2018)
• joelbondurant1 5y ago
• socrates1998 5y ago
  I am glad she was found guilty, but there are a few concerns. First, she was only convicted of lying to her investors, not the actual patients, which is laughable. Second, she is supposed to get up to 20 years for EACH of the counts (they will be served concurrently so she won't get 80 years). And I am curious as to how much time she will actually serve. Third, what kind of sociopath has a baby in the middle of a trial where she could go to jail and not see the kid for years??? Fourth, what kind of person meets her, googles her, thinks "it's all bullshit", then proceeds to get in a relationship with her AND have a kid with her. Man this woman is a con artist. She should get 20 years for the lies she spread and damage potentially did. Messing with people's blood tests for CANCER. So wrong.
  • CRConrad 5y ago
    > Fourth, what kind of person meets her, googles her, thinks "it's all bullshit", then proceeds to get in a relationship with her AND have a kid with her. Someone who gets rather handsomely paid for it?
  • trutannus 5y ago
    > what kind of sociopath has a baby in the middle of a trial where she could go to jail and not see the kid for years The same sort who would lie to cancer patients about their blood test results, and very probably lead a few to their deaths along the way? Sounds exactly like the Holmes we've all come to know.
  • ctchocula 5y ago
    Matt Levine has a good article [1] about Theranos that goes into the irony of why she got caught on defrauding investors and not the pafients. His hypothesis is that in court of law, it's easier to make the case for damages when it's easily quantifiable (e.g. $10B in damages) rather than 1000 possibly wrong blood tests. [1] https://www.bloomberg.com/opinion/articles/2022-01-04/slaying-the-blood-unicorn https://www.bloomberg.com/opinion/articles/2022-01-04/slayin...
• yawaworht1978 5y ago
  This is dated Nov 2013 and it's a hilarious read. People from the fields have laughed about her and Theranos for a long time. https://forums.studentdoctor.net/threads/theranos.1043576/ https://forums.studentdoctor.net/threads/theranos.1043576/
• onislandtime 5y ago
  One of the surprising things in this saga is how Walgreens partnered with Theranos. I actually had a blood test done in the downtown Palo Alto Walgreens. The results were obviously wrong so I had to redo them in a real lab. Any elementary school child can do a science experiment comparing the blood test results of Theranos with a standard lab. Walgreens deliberately failed to do due diligence because of some type of corruption. They contributed to the fraud and they should be investigated.
• relaunched 5y ago
  Holmes is a member of the uber-elite, upper .01%. Prof Gardner, in this article - https://www.mercurynews.com/2019/06/03/she-saw-through-elizabeth-holmes-now-stanford-professor-is-star-in-theranos-saga/ https://www.mercurynews.com/2019/06/03/she-saw-through-eliza... refers to Theranos as raising friends and family style funding. I guess her friends and family, given the circles she travels in, have a lot more money than most of ours. I've written about this a bit, but Elizabeth Holmes comes from 2 dynastic families. On one side, the Holmes family, whose name is directly tied to medicine / hospitals / clinics across Ohio. On the same side, a little bit farther up, is the Fleischmann family. Those yeast packets and jars that are in your cupboard...yes, that Fleischmann.
• bigodbiel 5y ago
  I am all for “fake it till you make it” specially with “sophisticated” private investors’ capital. But what she, and her enablers, did with their clients’ health was criminal.
• Gatsky 5y ago
  I just want to comment about her appearance, which I think has been carefully contrived during the trial. When she was CEO she dressed like Steve Jobs, had tightly bound hair and an intense look with an unwilling smile. During the trial she has let her hair down, dropped the turtlenecks and adopted a soft, perpetually distracted look. Maybe this reflects some inner transformation but I suspect none of it is accidental.
• volkanvardar 5y ago
  For anyone interested in more detail and the full story, Bad Blood[1] by John Carreyrou is a really gripping book. It was also in Bill Gates' list in 2018[2][3]. [1] https://www.goodreads.com/book/show/37976541-bad-blood https://www.goodreads.com/book/show/37976541-bad-blood [2] https://www.gatesnotes.com/about-bill-gates/holiday-books-2018 https://www.gatesnotes.com/about-bill-gates/holiday-books-20... [3] https://www.gatesnotes.com/Books/Bad-Blood https://www.gatesnotes.com/Books/Bad-Blood
• Threeve303 5y ago
  Still confused about her voice... Was that her real voice or what? Also, and perhaps more importantly, would the grift have worked at all without it?
• aagha 5y ago
  Bad Blood by Carreyrou is a fanstastic read! - https://www.goodreads.com/book/show/37976541-bad-blood https://www.goodreads.com/book/show/37976541-bad-blood