301–310 of 1001 posts
why are the charges "wire fraud" and not just "defrauding investors" ? is there some technicality at play here?
Yes, In order to invoke federal jurisdiction the SEC uses the fact that they communicated beyond state lines over the wire. This is why all the charges are called wire fraud. Relevant: https://www.law.cornell.edu/wex/commerce_clause
Earlier quoted context omitted.
Fake it all you want until your fakery harms innocent parties.
What's an example of a fakery that doesn't harm innocent parties? If you pretend a product (or a feature) that doesn't exist exists, then at the very least a competitor is unfairly harmed.
[1] In this context to take meaning as knowledge, not meaning "not guilty" here.
It blows my mind that she was found guilty for defrauding investors, but not guilty for defrauding patients about their test results. Investors know that every dollar they put into a company could disappear, it's why startups get capital from investors and not bank loans. But a patient does not expect for their blood test results to be completely wrong. Her tests weren't giving false-negatives or false-positives, the…
I mean, if you could find someone that experience material loss from it, or death, I think they'd have a very legitimate chance to sue. It's not clear to me what promises Walgreen's is actually making though.
Question: could Holmes have avoided all of this by pivoting to something else and not losing investors money. It is extremely common for startups to exaggerate their tech just to later pivot to something else without any repercussions.
I followed the case very closely, read the transcripts I could find daily etc. What Elizabeth did wasn't far from what many many many founders do. This was held to a legal standard, sure, but let's be real here... since when was the legal standard the SV standard? Is SV really the bastion of morality and legal ethics? Is that the new norm, good behaviour? Notably some investors refused to participate and iirc Draper…
Hard disagree on that one.
It's certainly not common nor acceptable to knowingly lie to investors like Holmes did.
There is nothing normal or common about the type of fraud that Holmes perpetuated, despite attempts to downplay or normalize it.
> I'm sure it's going to be an unpopular opinion but personally if this is the new standard, the SEC should have a pretty long list of founders to try at this standard.
Can you name a single one? Or is this just cynical speculation?
I've seen a lot of attempts to downplay Theranos' blatant fraud as an "everybody does it", but I haven't seen anyone calling out other companies who were caught committing fraud and everyone, including their investors, just shrugged it off. It's not normal.
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Based on a very quick reading, I think the most serious offense (the $100M one) would at least land in the 97-121 months bucket. If she serves half of that, best case for her is 4 years. Not too bad.
Hopefully she'll get more, SV could use a good example. Otherwise it signals that wantrepeneurs can keep doing it with minimal repercussions.
Meanwhile the only real sticking crimes are the one she commit against Betsy Davos (dirty corrupted rabbit hole warning if you Google her name). Obviously Bets placed few phonecalls. It it wasn't some VIP, she would get away with that too because all investments comes with risk.
It blows my mind that she was found guilty for defrauding investors, but not guilty for defrauding patients about their test results. Investors know that every dollar they put into a company could disappear, it's why startups get capital from investors and not bank loans. But a patient does not expect for their blood test results to be completely wrong. Her tests weren't giving false-negatives or false-positives, the…
Some founders "fake it till you make it", and this news should serve as a cautionary tale.
Maybe don't fake "medical devices" till you make it.
It's interesting that it took so long for this to finally be resolved, such that now - the technological goals that they had may actually be surmountable soon. I wonder what Theranos 2.0 will be called when it cross up in a few years. FBhealth ? BioBezosBot ? AppleSeq ? GoogleBlood ? NetStix ?
If you can do something that previously was strictly in the realm of magic, name your company after a famous magician.
Earlier quoted context omitted.
I followed the case very closely, read the transcripts I could find daily etc. What Elizabeth did wasn't far from what many many many founders do. This was held to a legal standard, sure, but let's be real here... since when was the legal standard the SV standard? Is SV really the bastion of morality and legal ethics? Is that the new norm, good behaviour? Notably some investors refused to participate and iirc Draper…
> people are having success with her ideas today Citation needed. The whole concept has a critical flaw, as pointed out by her engineering staff and medical advisors: blood tests require a certain minimum volume of blood to work, and that's inescapable because blood components are discrete, not continuous. For example, a drop of blood is about .05mL, or about 1/20th of a milliliter. A common testing sample size in a…
EDIT: And my favorite part is the first step the Siemens machines they used for testing is to "dilute" the part of the sample it is going to use (addition of DI water, to get the blood to the desired concentration). That is hard-coded into the protocol, with a specific dilution amount, and it is done for all the official Siemens tests, as well, hah.