Who followed the Elizabeth Holmes trial?
Who followed the Elizabeth Holmes trial closely? “The Elizabeth Holmes Verdict: Theranos Founder Is Guilty on Four of 11 Charges in Fraud Trial” (WSJ, which is the newspaper primarily responsible for bringing down the company):
At the 15-week trial, Ms. Holmes testified in her own defense, showing regret for missteps and saying she never intended to mislead anyone. She accused her former boyfriend and deputy at Theranos of abusing her, allegations he has denied.
She was found guilty on three of the nine fraud counts and one of two conspiracy counts. She was acquitted on four counts related to defrauding patients—one charge of conspiracy to commit wire fraud and three charges of wire fraud.
The verdict doesn’t make sense to me on its face. If the patients weren’t defrauded with false test results how could the investors have been defrauded? But I didn’t follow the trial, so probably the jury knows a lot that I don’t.
If it were up to me, I would imprison the investors for stupidity in thinking that a young American college dropout knew more about blood testing than the file cabinets full of Ph.D. chemists at Philips, Siemens, and F. Hoffmann-La Roche. I would have been reluctant to find Holmes guilty of anything or sentence this new mom to any prison time.
The man whom Holmes has accused of raping her daily, Ramesh Balwani, goes to trial next. Let’s see if readers, via the comments, can predict the ratio of prison sentence between these two defendants. I am going to guess that the immigrant/accused rapist receives a sentence that is 2X as long as whatever Holmes suffers. This is partly based on “Estimating Gender Disparities in Federal Criminal Cases” (University of Michigan Law and Economics Research Paper, 2018), which says, all else being equal, a person whom the jury identifies as a “man” will be sentenced to 1.6X the prison time that a person whom the jury identifies as a “woman” receives. I moved the needle from 1.6X to 2X because Mr. Balwani is an immigrant and I think both the jury and the judge will be angry that someone emigrated to the U.S. to become a criminal.
(If Mr. Balwani enters into a plea bargain, the above prediction should be revised to 1X.)
Related:
- There are a lot easier ways to get rich in Silicon Valley than by starting a company… Litigious Minds Think Alike: Divorce litigators react to the Ellen Pao v. Kleiner Perkins lawsuit
- my 2014 blog post in which I expressed skepticism that more testing would lead to better health and in which a quick email to a friend raised a forest of red flags (why couldn’t the investors have done at least this much due diligence?)
- Ellen Pao and Elizabeth Holmes intersect (the jury found criminal fraud; heroic Plaintiff Pao found “unconventional[ity]”, “hyperbole”, and a lack of “transparen[cy]”)
