As a poorly informed UK citizen, I’m new to this tale of fraud, deceit, megalomania, NDAs, lavish Halloween parties, voice modifications, Chuck Work (not to be confused with Steve Jobs), intimidation, 22-strong security teams, FOMO, lack of blinking ability, Shultzs George and Tyler, and a few more indiscretions nestling in the deep caverns of my consciousness that I can’t recall right now due to brain overload reading about this case.
I note that Ramesh Balwani’s attorneys requested separate trials for their client and his former paramour Elizabeth Holmes, with Balwani to go first. They got separate trials but a court ruled that Holmes should be go to court before Balwani.
As Balwani’s team wanted first dibs, one would assume they see an advantage in so doing. Since details of Holmes’ trial will presumably be available for Balwani’s court appearance I would have thought it an advantage to go second.
It certainly sounds like the makings of a great game of Fiasco!
The storyteller who pitches first gets to frame the story. Everybody else in the room is just arguing over details. In this case, it is clearly going to be Holmes making the case of being a victim of partner abuse and emotional manipulation, and even though the facts clearly don’t support that conclusion, Elizabeth Holmes has never bet wrong on being able to use her hypnotic gaze and penchant for persuasive sonorous bullshit to convince people of all sorts of things that should have them scratching their heads. Tyler Schultz reported repeatedly walking into Holmes’ office to confront her about the incongruence of her claims and the actual work being done, only to leave reportedly convinced of her vision, and then ten minutes later wondering, “What just happened?”
Whether her legal team will be able to pull off the same feats of legerdemain remains to be seen but I’m on record in predicting that Holmes will almost certainly get a light sentence of probably house confinement or even a suspended sentence while simultaneously screwing over her investors, employees, corporate customers, medical patients, and women at large. Welcome to Silicon Valley, where the startup culture is so ridiculously over the top even Mike Judge couldn’t effectively satirize it.
Stranger, I had been entertaining serious doubts about you, but these have now been dispelled in light of the sincerity, enthusiasm, and staring blue eyes exhibited in your response to my concerns. I am once again in perfect tune with your values of knowledge, eloquence, and common sense.
Some slightly more facetious commentary on the trial:
Holmes texted Balwani “you are the breeze in desert for me.” Now, along with the “might go to jail” thing, Holmes has to live with the knowledge that everyone knows she sent that text.
The relevant SNL skit to where the defendant would have preferred to pled guilty to murder rather than have his late night Internet searches read in court.
There was an op-ed in the N.Y. Times last week* complaining about how Holmes was being made the fall guy/woman while male tech entrepreneurs involved in sleazy promotions have gotten away with it.
The point missed here is that people’s lives and health were directly jeopardized by Theranos’ scammery. Taking people’s money under false pretenses is one thing, fatal consequences are another.
I agree that Holmes is unlikely to do serious prison time whatever the outcome of the trial.
*on the other hand, Maureen Dowd had a nice take on Holmes as Poor Little Victim.
Yeah, this isn’t a “Let’s make an example out of Martha Stewart for doing the same thing traders do every day because she’s a celebrity” exercise in performative persecution of white collar crime. If Tyler Schultz is to be believed, she was explicitly informed about the programs and with the Edison device and the manipulations being done to conceal them. The fact that she and Balwani were plenary executives responsible for keeping the research & development and clinical operations portions of the workforce well segregated (essentially, the people doing R&D did not realize that the clinical side was using conventional blood analysis machines and procedures to cover up for the gross error rate of the Edison) speaks for itself regarding her specific culpability.
But the fact remains that there are many, many technology startup companies working in medical biotechnologies promising spectacular breakthroughs (especially in life extension, gene therapy and modification, and machine-neural interfaces, three of the transhumanist technologies that really get venture capitalists really excited) with little actual evidence that their proposal is anything more than fantastical marketing. So far, few of them are anywhere near offering some kind of medical service or treatment (there are garage shops offering snake oil gene therapy treatments but they aren’t backed by hundred million dollar investments) but if the FDA is going to regulate and respond to concerns to these when and if they come to market the way they did with Theranos, they might as well just stay home.
The only reason Theranos came down when it did was because WSJ reporter John Carreyrou doggedly stuck to his skepticism and actively pursued potential whistleblowers, most of whom, even former employees with deep knowledge of the deceptive practices and failure of the technology, refused to talk to him because of the “ironclad” non-disclosure agreements they were forced to sign. Why only one guy was questioning this when a thundering herd of people in hematpathology and microfluidics were saying that the technology was fundamentally unworkable is a question that should be asked, as well as how courts should be enforcing NDAs in the case that they are used to conceal criminal or fraudulent behavior and force witnesses to aver from their legal and ethical responsibility to inform regulatory agencies and interested parties.
Is this a jury trial? If it is, I wonder if the jury will be swayed, even subconciously, by Holmes using that controlto voice as someone who is putting on a front and effectively lying about who she is.
Holmes’ lawyers bring up these tech start-ups as an “everyone does it” defense, but there are important differences. As noted by others, Theranos actually affected the health care of people. But the bigger difference is that most of these tech start-ups are making ridiculous promises about what they’re going to do, not lying about what they already have.
If Theranos took millions from investors by making grandiose promises about what they thought was possible and what they wanted to build, then I wouldn’t feel much sympathy for those who lost money when it didn’t come true. But Theranos lied that they already had working machines. They presented real test results and said they were from their Edison machine, when they were actually testing using competitors’ equipment. That’s a completely different ball game than bullshitting investors about your expected revenue in five years.
But sometimes (concerning the rest of the startups, not Theranos, and political fundraising, and religion, and gambling, and…) I start believing it should be legal to separate the stupid from their money,
This is reminiscent of our own James McCormick, who successfully sold fake bomb detectors around the world - especially in the Middle and the Far East. Iraq, Lebanon, China, Thailand and Mexico are among his customers, as are the Saudis, Indian police, a Belgian drug squad, a Hong Kong correctional facility and the Chittagong navy.
McCormick was tried in March–April 2013 at the Central Criminal Court in London. The court was told that "the devices did not work and he knew they did not work. He had them manufactured so that they could be sold – and despite the fact they did not work, people bought them for a handsome but unwarranted profit. "
He was sentenced to 10 years imprisonment on 2 May 2013. In passing sentence, the judge said: "Your fraudulent conduct in selling so many useless devices for simply enormous profit promoted a false sense of security and in all probability materially contributed to causing death and injury to innocent individuals.
I think that was a large part of her success – and she was most successful with old white guys.
But… And I say this as a straight woman who just watched the documentary, “Bad Blood”, which includes dozens of clips of Elizabeth talking, she also brims with charisma. I’ve rarely seen such a charismatic presenter. And she pitched something that everyone who thinks about it would WANT to exist. Go to a nearby drugstore, give a drop of blood, and get all your blood tests with no fuss, no waiting, no medical gateway.
Anyway, the jury includes a lot of old white men. I won’t be shocked if she gets off all the charges, or all but some fig-leaf charge.
And yes, she’s going to set back feminism by a decade or more.
