Theranos' Elizabeth Holmes Represents Herself at Trial After Lawyers Say She Stiffed Them (mercurynews.com) 99
McGruber quotes the Mercury News:
In her regular attendance at the San Jose federal courthouse for hearings in her high-stakes criminal fraud case, Theranos founder Elizabeth Holmes has been flanked by expensive lawyers. But in an Arizona civil case, she took part in a hearing this week representing herself, and by phone, according to a report Friday.
Holmes has seven lawyers preparing for the August trial start in her criminal case in U.S. District Court, and fighting federal prosecutors over evidence. In the Arizona case — a lawsuit filed by blood-testing customers against Holmes, the defunct Palo Alto startup Theranos, and drug store chain Walgreens — court records earlier this month indicated she had two lawyers defending her. That was after three attorneys representing her in that case quit in the fall, saying she hadn't paid them for more than a year and probably never would. Now, the court docket shows Holmes representing herself in the civil case.
And, according to a Bloomberg report, she didn't appear at a hearing in that case Thursday, instead calling in to the courtroom via an audio feed. She told the judge she wouldn't make any arguments, but would rely on arguments made by lawyers for the other defendants in the case, Bloomberg reported Friday, citing an unnamed lawyer said to be present at the proceedings.
Legal experts say Holmes faces considerable financial peril from the legal actions against her, with legal fees on top of possible restitution for investors, fines and a prison sentence.
In her regular attendance at the San Jose federal courthouse for hearings in her high-stakes criminal fraud case, Theranos founder Elizabeth Holmes has been flanked by expensive lawyers. But in an Arizona civil case, she took part in a hearing this week representing herself, and by phone, according to a report Friday.
Holmes has seven lawyers preparing for the August trial start in her criminal case in U.S. District Court, and fighting federal prosecutors over evidence. In the Arizona case — a lawsuit filed by blood-testing customers against Holmes, the defunct Palo Alto startup Theranos, and drug store chain Walgreens — court records earlier this month indicated she had two lawyers defending her. That was after three attorneys representing her in that case quit in the fall, saying she hadn't paid them for more than a year and probably never would. Now, the court docket shows Holmes representing herself in the civil case.
And, according to a Bloomberg report, she didn't appear at a hearing in that case Thursday, instead calling in to the courtroom via an audio feed. She told the judge she wouldn't make any arguments, but would rely on arguments made by lawyers for the other defendants in the case, Bloomberg reported Friday, citing an unnamed lawyer said to be present at the proceedings.
Legal experts say Holmes faces considerable financial peril from the legal actions against her, with legal fees on top of possible restitution for investors, fines and a prison sentence.
Wow! (Score:5, Insightful)
The Dunning-Kruger is strong with this one!
It's a minor civil trial (Score:5, Interesting)
Re: It's a minor civil trial (Score:1)
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still, expensive civil trials invite SLAPP lawsuit (Score:2)
Somehow we need to make lawsuits strike a balance between too hard win and too expensive to win. Maybe if there could be some FULLY OPTIONAL mediation court before hand that will award layers feed funding to parties accepting their resolution. If both accept then of course no fees are expended since the mediation is resolved. If not then the party that accepts when the other does not will get some compensation as either the plaintiff or defendant.
It would be optional to go through this.
the pit fall here w
Re:Wow! (Score:5, Insightful)
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Re:Wow! (Score:4, Interesting)
Last time my wife did jury duty, it was this guy representing himself. He stole a wheelchair from a donation center. For use as a halloween costume. This is in a very wealthy area.
He was offered a fine + slap on the wrist amount of community service. "No," he said, "I will not admit wrongdoing."
He represented himself, and incriminated himself right there in the courtroom saying it wasn't a crime because he intended to bring it back.
He ended up with several months in prison. The jury maxed it out because he obviously felt zero remorse.
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Obviously the defence didn't work in your story, but it may not be as flawed as you might think.
Depending on the jurisdiction (at least applicable to UK-based common law jurisdictions), there is a requirement to prove an intention to permanently deprive the rightful owner of the item, and as such an intention to return the item can allow you to wriggle out of the definition of the crime.
I'm not familiar with criminal law in the US, but I suppose the precise definition of theft various from states to states,
She is rich (Score:4, Informative)
Married a heir to a hotel fortune. So it isn't lack of money.
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Um, doubtful. That chick can talk her way into anything.
Re:She is rich (Score:5, Funny)
That chick can talk her way into anything.
So far though she has a pretty bad track record of being able to talk her way back out again.
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A prenup protects the husband if they divorce and only in the case of divorce. It doesn't let protect the couple's communal assets in case of a civil action - while they are married the money is just as much hers as his (California is a communal property state.) So, he would have to divorce her before the verdict came in, and I'm not 100% sure that alone would be sufficient.
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You don't understand what "community property" means.
All assets (such as her husband's stake in his family's business) that someone enters the marriage with are by default individual property, not community property. Investment income from such assets also are individual property as are any inheritances or gifts received by one of the partners during the marriage. It's possible to commingle individual property such that it ends up being characterized as community property eventually, but that's not somethin
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Sorry, you're right that if they divorce that the assets previous assets would be separate property, but until then they could be garnished to satisfy her debts. And debt accrued duriing the marriage (as a result of the lawsuit) would be community debt, which isn't even divided 50/50 but is divided based on the ability of the two partners to pay for it. So he could divorce her and get the vast majority of any new debts
Re:She is rich (Score:4, Informative)
Holmes married Evans around the middle of 2019. The actions that may result in liability were taken by Holmes long before that and Evans has no liability for those actions (assuming he had nothing to do with Theranos which I believe is the case). Separate property of one spouse can not be taken to satisfy the debts of the other.
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The actions that generate the legal action occurred before the marriage.As I understand, the debt is generated when the jury returns a verdict. See also, some rich people commit suicide before their trial is done to avoid fines so they can pass more material goods to their family.
Separate property not only can be used to satisfy community debts, but unlike community property (split equally), in the case of a divorce community debt is split according to who can pay it, not equally.
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Her husband is associated with a well-to-do family. Anne Evans, Elizabeth's mother-in-law, may be wealthy.
One can only imagine what the prenup says.
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If he is that wealthy and, knowing her criminal liabilities, if he and his lawyers didn't draft an iron-clad prenup that protects all his and his families assets prior to the marriage, he would deserve being taken for every dime. Marrying someone for the prison sex is one thing; losing one's forture to them is quite another.
deliciously stupid (Score:3)
Wouldn't we all want to have an attorney that went to Stanford represent us. And by "went to Stanford" I mean attended Standford for a little over a year.
She's a real character. I cannot wait to see the highlight reel from the SEC trial.
Re:deliciously stupid (Score:5, Interesting)
Perhaps, but these two cases have very little in common. I wouldn't classify them as "peas in the pod". Elon is still a well-funded sociopath & media darling with a fully-operational reality-distortion field, good attorneys, and a company that produces a working product and commands astonishing market cap for its size. Meanwhile Elizabeth Holmes is just a bankrupt, run-of-the-mill delusional psychopath who is out of her league who lied and lied and lied and lied and lied about everything. The only thing left of Theranos is a bunch of pissed shareholders and creditors of a once ~$10B company.
I expect to see more than a slapped hand for Elizabeth, but I am hoping for some completely outlandish statements from her.
Re:deliciously stupid (Score:5, Interesting)
Theranos is a fraudulent smoking hole in the ground, produces nothing, and will never pay off.
The situations are a bit different.
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Musk is a obviously a bit of a loose cannon at times, but I would suggest there is a bit of difference between and executive running his mouth, and someone, apparently, overtly lying over and over and over again.
Personally, I have never been excited about Tesla and I would never touch its stock at its lofty valuation, but the shortsellers got very deservedly crushed, and it had everything to do with their echo chamber of over the top anti-Musk nonsense.
Re: deliciously stupid (Score:1)
And by "went to Stanford" I mean attended Standford for a little over a year.
By "went to Stanford" in this context, you should be meaning that they "graduated from Stanford Law."
What the fuck are you smoking??
Re: deliciously stupid (Score:2)
If nothing else, She was all in (Score:2)
Forbes in 2015 pegged Holmes’ net worth at $4.5 billion, based on an estimated $9 billion valuation for Theranos and her ownership of half the company’s stock. But the SEC has said Holmes never sold any stock, and that between 2013 and 2015 she received a salary of $200,000 to $390,000 per year.
Knowing the entire time that the company and fortune were standing upon the foundational equivalent of quicksand, she never sold a share of stock? If that's accurate, wow, she has the chutzpah.
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No need. She was from a rich family.
Re:If nothing else, She was all in (Score:4, Insightful)
Selling stock would've accelerated the end of the company and caused massive slide in the stock value, as well as presenting possible further legal issues. Better to take the safe route of collecting $300,000 a year while projecting confidence by not selling stock.
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Exactly, it's the same situation Elon Musk has been in. Paper billionaires have little cash and are much more fragile than most assume (Musk's jet, mansions and extravagant living expenses are all paid by the company). Their financial status literally lives and dies by every tick of stock quote.
https://www.latimes.com/busine... [latimes.com]
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Exactly, it's the same situation Elon Musk has been in. Paper billionaires have little cash and are much more fragile than most assume (Musk's jet, mansions and extravagant living expenses are all paid by the company). Their financial status literally lives and dies by every tick of stock quote.
https://www.latimes.com/busine... [latimes.com]
At least his companies actually have product though.
Re:If nothing else, She was all in (Score:4, Insightful)
Or she honestly believed her own lies. A lot of people end up doing that. Probably had a reasonable idea at the start (a simple test for one thing only), then go in over her head for the grand vision, at which point the sunk costs caused her to naively try to sink in even more money to pull it off. Then if she gets it into her head that it's all going to work if it weren't for those lazy workers who keep screwing up...
But ya, even if you have a great workable idea, selling off at least some stock is a smart thing to do. Most startup stock eventually ends up worthless, and whether they succeed or fail has little to do with the quality or innovativeness.
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Or she honestly believed her own lies. A lot of people end up doing that. Probably had a reasonable idea at the start...
Likely true, and self-delusion is a hell of a thing... she probably half believed she could turn it all legitimate, given enough time and resources. Not selling even a few $tens of millions$ of the $billions$ in stock indicates an incredible sociopathic discipline, or a total disregard for situational awareness.
Liz's accomplishments prior to the house of cards folding indicate otherwise. Every savvy criminal ever has a getaway stash. Maybe she is not savvy, but more likely, she was able to sequester funds o
Re: If nothing else, She was all in (Score:2)
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The idea is a good one and worth believing in. The only problem is knowing how to implement it.
Very true, but the same can be said for transporters and holodecks.
Re: If nothing else, She was all in (Score:2)
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Re:If nothing else, She was all in (Score:5, Interesting)
We can look at how she ran the company, and every indication is that she knew it was a complete scam. The main indicator for me is that she made sure the departments didn't communicate with each other - the idea being that no one person there outside of her inner circle had the complete picture (which was that their product was bullshit). I think she knew it was a scam, but probably thought she could string people along long enough to cash out.
Or self dellusion and paranoia (Score:2)
she made sure the departments didn't communicate with each other - the idea being that no one person there outside of her inner circle had the complete picture {...} I think she knew it was a scam,
Or she could be so sure that her company is going to work, so persuaded that it's actually doable, that she was affraid that some competitor would spy on them and steal the "secret sauce" she was persuaded having that would the company success.
I.e.: she was afraid of IP theft, even if there wasn't actually any real IP worth anything where she though.
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More likely it's another case of "in too deep."
She's an upper manager. Her job is to listen to bold promises from lower managers and approve their proposals. I wouldn't be surprised if she genuinely believed that the crazy ideas would work given enough R&D, but when it became obvious that the ideas were too ambitious or flawed, it made more sense to cook up any BS necessary to keep the money flowing. Somehow, things would "work out" in the end. Things just snowballed from there until it eventually t
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I think she might have gotten caught in the vapor ware trap. Sure we haven't solved the problem yet but we have the brightest people working on it and are so close. As long as we make the product real before anyone finds out ...
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Then there's also how the media painted her up as the feminist Steve Jobs, which obviously further added to her hubris and inability to stop and face the facts.
Not feminist - female.
And not the media - she purposefully changed her image to be Jobs-like.
She was very VERY actively pushing a public version of herself that emulated Jobs, turtlenecks and all.
She'd even change her voice in public and put on that blue-eyed stare. Which was further enhanced in publicity photos.
Think unsettling. Think... Different.
And that's kinda the issue. She wanted to be Jobs 2.0. Younger, blonde, tall, blue-eyed and female.
She wanted to be famous and rich - not the other way around. S
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No, she's a fantasist. Watch the movie "The Inventor - Out for Blood in Silicon Valley" and marvel at how disconnected from reality she is.
Her old professor was interviewed about Holme's patent for a blood testing patch, and basically she says "you can't do that, its physically impossible". (25 mins in)
My favourite bit in the movie is her being interviewed and talking about hiw creative she was even as a child, she drew a time machine, and it was incredibly detailed. The implication of the interview was cl
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Or she honestly believed her own lies.
I doubt it. The company had no product and no plan to produce any product. It was a pyramid scheme of hype, get politicians to buy in build up more hype. If she had started selling off stock it would have caused more eyes to pry into exactly what the "business" was doing.
No idea what the exit strategy was. Even if she managed to get a few billion out of investors by dealing them hype, it isn't like they would let her walk away with it.
Re:If nothing else, She was all in (Score:5, Informative)
she never sold a share of stock?
Theranos never IPOed. So she couldn't sell shares to public investors.
She could, and did, sell shares to VCs.
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Makes sense. Once a company goes public, levels of scrutiny increase, and obligations to shareholders invite unwanted scrutiny by the initial (SEC) people.
Forget it Bill, it's Slashdot (Score:5, Informative)
Thanks for the breath of financial literacy around here.
Difference: Product (Score:5, Insightful)
Whenever a story relating to Tesla's financial aspects appears on /. {...} The amount of financial illiteracy (e.g. reading a basic balance sheet to determine financial health) and sheer gullibility among the technical crowd is simply embarrassing these days.
Well there's a key difference between Tesla and Theranos.
- Tesla have a product, that actually works (I mean the EV works as a car for reasonnable distance that can fill the needs of a significant fraction of the market. It's an actually product that one can buy and that works as supposed, without violating any law of the physics. I'm not speaking about all the bullshitting going about the fully autonomous self-driving whatever magic...)
- And they are able to sell said EVs with good margins.
- It's just that Tesla reuses any money they make into building more factories in order to be able to manufacture even more of those sellable product. So for now, even if the balance sheet is still negative as of today, you kind of see how they could eventually start to make profit one day (basically if they stop building new factories and start pocketing the margins on the EVs they are selling).
Of course, again, I am talking about the actual product that leaves their factory lines. Not the crazy shit about autonomous cars, flying roadsters and all the fluffing of investors. (On the other hand, in the modern day of "startup era", fluffing investor with crazy shit - aka being "visionnary" - is the expected behaviour, so... meh...)
Meanwhile contrast with Theranos:
- if you scrap under the investor fluffing, there's not much of an actual working product being sold. Not only that, but their entire vision is centered around a product which violates the current state-of-the-art biochemistry (we're entirely in Tesla's flying roadsters territory, not in Tesla's EVs currently on the road).
- I'm not saying that one day, with enough R&D and advances in miniaturization that couldn't become reality. But the tech isn't there yet.
If you look at it:
- Tesla's main challenges are basically engineering challenges, to be able to scale out an even increasing number of manufactured products, and increasing the quality of these.
- Theranos' main challenges are basically advancing the fundamental science and pushing the boundaries of miniaturization of biochemical process until eventually the product becomes even doable in the first place.
Which boils down to:
- under all the PR crap, there are actual engineer working in collaborating teams at Tesla helping improve the production (in Apple metaphore, they have a couple of Steve Wozniaks around).
- meanwhile at Theranos, Holmes is trying to replicate to the perfaction Apple's Steve Job's charismatic personna and RDF.
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she never sold a share of stock?
Theranos never IPOed. So she couldn't sell shares to public investors.
She could, and did, sell shares to VCs.
While an IPO is needed for selling shares on an open market, there are still avenues for selling pre-IPO shares, such as secondary stock transactions. So, there was a way for Holmes to cash out at least partially. The question is whether she took advantage of those ways to lock in cash.
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There's other ways around that. Take a loan out with the stock as collateral. You get cash, the bank gets an asset or interest over time, and you don't have to pay taxes as there is no sale. The rich have work arounds.
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There's other ways around that. Take a loan out with the stock as collateral. You get cash, the bank gets an asset or interest over time, and you don't have to pay taxes as there is no sale. The rich have work arounds.
I'd hate to be the financial institution holding that stock as collateral.
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In this case, yes. But if you were a bank a year before everything came out, you'd have taken it at a valuation discount in a second.
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Her daddy was an Enron executive who lost bundle (on paper). Holmes may well be a dyed in the wool "sincere" believer in the Fake It 'Til You Make It path to success and self-actualization.
Birth Control, Use It (Score:3)
Re:Birth Control, Use It (Score:4, Funny)
One Elizabeth Holmes is too many.
But ... but ... she's a woman! CEO! In tech! All praise be upon her!
Re: Birth Control, Use It (Score:3)
she's a woman
(She might even have - dare I say it?? - a biological vagina...!)
Verily... (Score:4, Funny)
One Elizabeth Holmes is too many.
But ... but ... she's a woman! CEO! In tech! All praise be upon her!
Now kneel towards Silicon Valley 5 times per day.
A cure worse than the disease (Score:2)
Birth Control, Use It. One Elizabeth Holmes is too many.
Yes, stop breeding because your kid MIGHT be an Elizabeth Holmes. Ignore the fact that they might be a Mozart or an Einstein or a Jonas Salk or an Apostle Paul, or any other example. Or, more likely, that they'll probably just be a normal kid that grows into a normal adult. But hey, you can die alone, surrounded by empty wine bottles and cats, knowing that YOU did YOUR part to prevent the next Theranos.
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Yes, stop breeding because your kid MIGHT be an Elizabeth Holmes.
Or even, god forbid, another DesScorp!
Just business as usual (Score:1)
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Jesus. How stupid are you? It was a dumb joke. And yeah, I get it: Trump bad. Your team good.
Re: (Score:2, Troll)
WRONG
it's just trump bad. And you fucking know it.
Accept it, and we can all move on.
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Jesus. How stupid are you? It was a dumb joke. And yeah, I get it: Trump bad. Your team good.
Trump is a legit fraudster though. Would you like to see the list again?
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she was faking it
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Crazy eyes. Other prisoners will probably steer clear.
Re: Those pretty big blue eyes... (Score:3)
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Depending where she ends up, they may or may not have very different ideas about what is scary.
How good is she at making shanks out of toothbrushes?
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Don't fear the ones with shanks. Fear the one that tells them who to shank.
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Your mistake is perceiving these as exclusive groups.
In order to be able to tell somebody else to shank somebody in the first place, they have to fear you're going to shank them. You have to be fucking legitimately scary yourself, and then after you've done a bunch of shanking and not been killed in retaliation yourself, then people will fear you enough to take the risk of following your orders.
It is the same in almost any primate group, excepting Bonobos.
And if she has money, but isn't tough, she's going t
"In her regular attendance..." (Score:2)
This makes it sound like she's the old couple who always shows up on free pie day at Village Inn.
Complex cases, but still... (Score:2)
Here we are entering year 5, with no end in sight. I know these cases are complex, but still: Justice should be at least somewhat swift. There's really no reason to allow the various parties to drag these cases out for year, after year, after year... In the end, the only winners are the lawyers.
Of course, it is the lawyers who have - through their over- representation in legislatures - crafted this legal system with its overly complex rules and procedures.
How likely is it she has a stashed fortune? (Score:2)
How hard would it have been for her over these many years to have stashed a few million dollars for her future?
I mean, if you see yourself getting jailed, fined and losing civil suits to the point that you have zero to negative assets, at some point wouldn't it be a huge temptation to come up with some way to stash cash? So that in 10 years or whenever you get out you wouldn't be dead broke, even if it only possible to use the money to make your life somewhat easier?
Overseas bank deposits? Actual cash or
Business-person stiffs everyone. (Score:2)
Horror.
Amazement.
Not.
What was that Klingon saying I heard recently? "A fool and his money are soon parted." No, sorry, it's Klingon, not Business-spesk. "his head", not "his money".