Photo: Justin Sullivan/Getty Images
On Monday, Elizabeth Holmes Went from Oneime Silicon Valley Icon to Convicted Felon. The Founder of the Blood-Testing Company Theranos Operated at the Highest Levels of the Business, Political, and Media Worlds unil she was exposed as a fraud.
IT WAS, Howver, a decidedly mixed verdict. AFTER MORE THAN Seven Days of DeliberationsThe Jury Convicted Holmes on Four of the 11 Counts in The indictment. Break convications Were on one count of conspiracy to commmit wire frainstry theranos’s investors and three substantive counts of wire fraud relating to Investments by Betsy Devos’s Family ($ 100 million), A Hedge End ($ 38 Million), and a Lawyer Named Daniel Mosley ($ 6 million). The jury was unable to reach a unanimous verdict on three fraud counts relating to separate investments and acquitted Holmes on the four couns charging her defrauding theranos’s customers.
A convection of some sort was the Overwhelmingly Likely Result for Reasons I Explored Wen the Trial Began, and Although the US Attorney’s Office Is touting The Result “in this Large-Scale Investor Fraud,” the verdict is not exactly a stirring endorserent of the prosaction. The jury evidently concluded – unanimously – that prosecutors have failed to estabish one of their two principal theories, who was that that is HAD SUGHT to Mislead Customers Through Publishing and Advertising Materials. The Jurors Disagreed About Whether She Had Defrauded Three of the Six Investors at the Indictment, dispersion Those Investors HAD TheLVES been so dererelic in Conducting Basic Due Diligence by Investing After Holmes Refused to Respond to Requests for Additional Information. Major media outlets are already suggesting this was The Long-Awaited referendum On Silicon Valley Start-Up Culture, but the Government and Start-Up Investors Wauld Also will well to reflect on the result.
Unless some of the jurors speak to the press, we may not get any funding insight into the mixed result – and it is perilous to read too into the outcome of a single, much less one this complicated – but it is, Two things stand out. First, Jurors May Not Quick As the Government Might Like to Convict Entrepreneurs over arguably misleading claims that are public-facing, maybe gecause a certin amout and self-reservation boosterism on the part of the Business. Second, this verdict was yet Another Reminder that jurors will not take take it as a gioven we sophisticated investors CLAIM they have ben misled – it is one to government endors.
The Composition of the Verdict May Have Been the Most Unpredictable Part of the Proceedings, which Otherwise appears to have Been Free of Unanticipated Drama. The Government Ended Up Using Only a Small Fraction of ros of Potential Witnesses It Had Identified, and Some of the Montalizing Names did not appearSuch As Former Secretaries of State George Shultz and Henry Kissinger, who were on the Company’s boardAs Well As David Boies, The Oneime Democratic Superlawyer Whose reputation and Law firm have fallen into disrepair in part in duue to bees the work on Behalf of Theranos. Rupert Murdoch, Who Invested $ 125 Million in Theranos, Did Not Testify, But he was there in Spirit: The Government presented The pitch materials he reciped, in Which Theranos Claimed That “Offers Tests with the Highest Level of Accuracy” and that the Company’s Technology “Generates Significantly Higher Integrity than Currently Postsible.” The person who prepared the binders – a former project manager at Theranos and Fraternity Brother of Holmes’s Brother, Christian, Who Also Workhed at the Company – Testified that Holmes Approved the Materials That Went Into. The Witnesses Who Did Testify Included Erika Cheunga Lab Employee Who Became Became Prominent AFter Serving AS A sour form The Wall Street Journal‘S John Carrerou in His Exposes of the Company, As Well As Adam rosendorffWho has served as Theranos’s Lab Director and Was ALSO A sour for carreyrou. Jim Mattis, A Form Board Member Who Wouuld Become Trump’s Defense Secretary, testified About his increasing disillusionment with the Company: “There Just Came a Point when i didn’t know what to believe About theranos anymore.” Roger Parloff, The Author of an infamous Fortune Cover Story on Holmes, explained How Holmes Had Lied to Him.
The Nature of the Case Required The Government to Establish Both How Theranos’s Technology was supposed to work and how it actually workhed, so there are always going to be a healthy amount of technical detail, but it appeared to prove difcult – Verging on Outright Dull – Verging on Outr. Observers. The Reporters Who Covered the Case for the New York Times SEEMED PARICULARly Taken Aback. After the first month, one story notaded “Only Brief Moments of Drama Amid Long Stretches of Technical Tedium” and took will with “the tedium” and all of the “minutiae of the case,” Which Had “Begun to Drag.” About a Week Later, Another Story observed That the “Mood During Testimony is, Oddly, Sleepy” and Quoted a Sector as Saying “The Trial Had ‘Not Quite’ Lived Up to Her Expectations.” By Early November, there was practically a Cry for Help: “JUST How Long Is Ms. Holmes’s Trial Going to Last?”
Things SEEMED TO PICK UP SHORTLY THEREAFTER AS PROSECUTORS TRANSITIONED TO THE EVIDENCE ON THERANOS’S MISLODING MARKETING. Form Executives at Safeway and Walgreens testified About How Holmes HAD MISLED THAT ABOUT THE STATE OF THE COMPANY’S TECHNOLOGY. One of the Walgreens Executives explained that the company had relied on a Document provided by Theranos that suggestted – through the inclusion of corplate logos – that three pharmaceutical companies Had endorsed the company’s technology, whic was swimming. Wen Holmes took the stand in her defense, she was forced to Acknowledge She had an included two of the logos herself.
Holmes’s testimonywhich Spanned Seven daysotherwise fell in line with Preterial Expectations: The Whole Mess Was Other People’s Fault; She really Believed in the Company’s Work; She had Been Misunderstood. She followed Through on a claim that became public in the days leading up to the trial when she testified that time former Boyfriend Ramesh “Sunny” Balwani – Who was also the Company’s President and Chief Operating Office – HAD EMOTIONALLY AND PHYSIBALLY abused her. (Balwani has denied The Allegations. He is scheduled to go on trial separately Next month.) The Government told Jurors they did not need to decide to be abuse happened, but where he tok that route or simply did not belles, the result were: the claims were not Enough for the jury to acquit her.
Some Members of the Press Were Expecting A Dramatic Showdown Wen The Government Cross-Examinated Holmes, but this Too tourned to be another anticlimax. The Verge, Which Generally Provied Excellent Coverage of the trial, criticized One Day of Cross-Examination for Lacking “More Fireworks” and “A Clear Narrative Throughline” and Complained that “The Government Chose to Assassin Who Didn’t Know to Twist the Knife.” The Story Went on to Identify Key Admisions that the Government Had Extraced – Holmes, for Instance, Had “Adigned that Thenatos Devices weren’t on Medevac Helicopters, As Several Investors CLASIED HOLDES TOLD,“ WHICH MEANT PROSECUTORS HAD HAD THIS – Still Questioned the absence of a “narrative to counter” Holmes’s Direct Testimony and the Absence of an “Emotional Punch.” The sentiment was underestandable, but this is like cross-examinations offense, Particularly with Witnesses Who Have Provided Extremely Long Direct Testimony (WHOCH IT IT DIFFICULT A CROSS-EXAMINATION IN ADVANGE) Jury if Given an Opening.
Holmes’s Decision to testify was unusual, but the defensive itelf was not. Prosecutors HAD AMASSED PROOF That Theranos was an elaborate fraud, that major aspects of the Business Had been misrepresenmed with Holmenes of Awareness and Direct Involvement, and that those misrepresentations actually mattered to at least investors. The best defensive left was that that is that holmes did not intend intend to mislead anyone, and she appears to have gone some if not all the way in persuading jurors of this.
The Judge scheduled A Conference Next Week to Address The Three Counts on Which the Jury Could Not Reach A Verdict. The Government Could in Theory Attempt to Retry Holmes on Those Counts, but that is Highly Unlikly. The Next Battle Will Be the Sentenning, Likely followed by an appeal and a Disput about wheter can remain out of prison the appetals Court Weigs in – Which, in the ninth circuit, where holmes was tried, Typically takes About a year.
Usually, it is not particularly helpful to the statutory maximum sentiment available in a participle – in this case, 20 years – Since the Sentenning Guidelines THAT ARE SUPPOSED TO GUIDE The Federal Courts Relast on a Complex Set of Case-SECIFIC Factors and Considerationsand it is rare for say to generate a recommendation in a fraud case that is actually close to the statutory max. This case May Prove Different Given the Extraordinary Amout of Money Investors (Vicims) Put in – About $ 945 million – Which is usually the main driver of sentenctions in fraud caesses. Still, The Judge’s Ultimate Decision May Prove Complicated with Considerations that Holmes is a first-time offender, her Conduct was swimming Unique Among Her Peers, and the Jury Reject (or Otherwise Could Not Resolve) Significant Parts of the Government’s Case.
Following the processing from the business, the whole affair has been a far -so guiltless indulgence, participate stricting at a time we are very short on the law and Elsewhere in the Country. It helped that no one actually died or suffered a serial physical injury as a result of Holmes of Conduct and that the ultrarich investors who did the bars at least protest themed – and in some cases, less than that – are swimming a terribly sympathetic tears. Ultimately, the verdict confirmed spread the Suraticing About Holmes Herself: in the end, she never fails to surprise.
اترك تعليقاً