The founder of Theranos, who sought to change healthcare with a device she claimed could make medical diagnoses using just a fingerprick of blood, has been found guilty of engaging in a multi-million dollar scheme to defraud investors by making misleading and false statements about the technology's capabilities
The jury deliberated for more than 50 hours over seven days before reaching a verdict on Monday.
The jury needed to determine if the Theranos founder cheated investors and doctors and patients by using their laboratory services. The jury found that she was guilty of 4 counts. She was found not guilty of conspiring to defraud and defraud paying patients. The jury couldn't reach a decision on some charges.
The jurors in the trial were faced with a lot of obstacles, but they were able to figure it out, according to the US Attorney. I would like to thank the jurors for their thoughtful and determined service. The guilty verdicts in this case show that Ms.Holmes was involved in a large scale investor fraud.
It will be up to the judge to decide her sentence. Each guilty count carries a maximum of 20 years in prison and a $250,000 fine. The person could be ordered to pay back the money. One of the investment firms she was convicted of defrauding is owned by the family of the Secretary of Education.
The reporters in the courthouse said that the verdict didn't come as a huge surprise to the man.
According to Diane Birnholz, a former federal prosecutor and lecturer in law at the UCLA School of Law, a sentence that is much shorter than what the law allows is likely to be given to her.
Less people have to say goodbye too soon to people they admire, as she famously repeated in interviews and appearances, because she wanted to make critical lab tests more accessible.
The device that Theranos developed was said to be faster, cheaper, and more accurate than all other lab equipment on the market and could run hundreds of tests on a few drops of blood. In 2015, a Wall Street Journal investigation revealed that the machine, which was much smaller than other blood analyzers, could only run a small number of tests and its results were rife with errors. Instead, Theranos used commercially available machines to run most of its tests, and used larger samples from patients to conduct some tests.
The Department of Justice indicted the company and its co-conspirators, including the company's president and COO, on charges of conspiracy to commit wire fraud and nine counts of wire fraud. Balwani is going to face a trial this year.
The case had drawn fascination among people who watched the very public rise and fall of the man who was captured in a variety of promotional materials and interviews. A scripted series with actor Amanda Seyfried is in the works. Many of the projects are related to the question of how far a Silicon Valley startup should go in disrupting an industry. How could so many people buy into a failing business? Was it a person running a scam or a delusional dreamer?
The federal indictment and trial in this case have sent a message to other executives and entrepreneurs in Silicon Valley to be careful not to make misrepresentations to potential investors and customers. What matters is what you say at the time, not what you hope to say in the future.
During the trial, prosecutors used emails, text messages, documents, audio recordings, and video clips ofHolmes speaking in interviews, along with testimony from more than two dozen witnesses, to argue that she was clearly aware of problems with the company's technology and still lied about its capabilities to get The company lied about its work with the military and pharmaceutical giants in order to get investors and business partners to finance its operations, prosecutors told jurors.
John Bostic, an assistant US Attorney, told jurors that the real version of Theranos was vastly different than the one she was portraying. There was a lack of effort in the disease that plagued Theranos. It was a lack of honesty.
The jury was asked to listen to the recording of a call in which she talked about the capabilities of the company's technology to investigators. During the call, which was secretly recorded by one of the investors, the former CEO said that Theranos was focused on work in the Middle East and specifically Afghanistan, as she talked about the potential to change survival rates overseas.
The military is a big deal for the company. We have been doing a lot of work there. We have been doing a lot of work for Special Operations Command.
Several investors testified that they came away from the call with the understanding that the military was using Theranos devices. Even as she denied that she had ever told anyone that, she confirmed that the company's equipment was never deployed in medical helicopters or on the battlefield.
Kevin Downey focused on the word "potential" while discussing the company's military work in this call and in other conversations, telling jurors, "She never says Theranos devices are currently being used."
Bostic asked jurors to consider if investors, board members, and journalists left those conversations with the understanding that she was talking about Theranos's present-day capabilities.
The former CEO was portrayed by the legal team as a business person who worked hard for years to make lab testing more accessible. Despite admitting that she had made several mistakes along the way, she believed her company's technology worked.
Downey said that she went down with the ship when it went down because she believed in the technology.
Over the course of seven days, she denied that she tried to deceive anyone, that she INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals INRDeals
The issue of whether she was a victim of abuse was not related to her actions as CEO.
