“We will urge prosecutors to be bold,” Lisa O. Yet the Justice Department under President Biden has renewed its focus on white-collar crimes. Those downfalls captured the public’s attention, but did not result in criminal charges. In recent years, tales of start-up chicanery, from the bungled initial public offering of WeWork to the aggressive boundary-pushing tactics of Uber, have not slowed the flow of money toward charismatic founders spinning tales of business success. Some have warned that more Theranos-like disasters loom. The verdict arrived in a frenzied period for the tech industry, with investors fighting to get into hot deals and often ignoring potential red flags about the companies they were putting money into. Judge Davila pushed them to continue deliberating, but they were unable to agree. On Monday, jurors told the court that they were deadlocked on three of the charges of defrauding investors. They were also not swayed by the prosecutor’s case that she had defrauded patients. They were not swayed by her defense of blaming others for Theranos’s problems and accusing her co-conspirator, Ramesh Balwani, the company’s chief operating officer and her former boyfriend, of abusing her. Holmes lied to investors about Theranos’s technology in the pursuit of money and fame. The mixed verdict suggested that jurors believed the evidence presented by prosecutors that showed Ms. And Theranos, which dissolved in 2018, is likely to stand as a warning to other Silicon Valley start-ups that stretch the truth to score funding and business deals. Holmes would be the most notable female executive to serve time since Martha Stewart did in 2004 after lying to investigators about a stock sale. Few technology executives are charged with fraud and even fewer are convicted. Holmes’s “culpability in this large-scale investor fraud.” attorney, said in a statement that the guilty verdicts reflected Ms. “We collectively have been through many things.” “It’s been a long case,” Judge Davila told the jury. She went down the row of family and friends in the court gallery behind her, hugging each one before leaving through a side door. Then she gathered her belongings and whispered to her lawyer. Holmes - who had falsely claimed that Theranos’s blood tests could detect a variety of ailments with just a few drops of blood - sat motionless. A sentencing date is expected to be set at a hearing on the three hung charges next week. Davila of California’s Northern District said he planned to declare a mistrial.Įach count carries a maximum sentence of 20 years in prison, terms that are likely to be served concurrently. The jury was unable to reach a verdict on three counts of deceiving investors, for which Judge Edward J. Holmes was found not guilty on four other counts related to defrauding patients who had used Theranos’s blood tests. A jury of eight men and four women took 50 hours over seven days of deliberations to reach a verdict, convicting her of three counts of wire fraud and one count of conspiracy to commit wire fraud by lying to investors to raise money for her company. Holmes, who had once promised to revolutionize health care, was the most prominent executive to field fraud accusations in a generation of high-flying, money-losing start-ups. Elizabeth Holmes, the founder of the failed blood testing start-up Theranos, was found guilty of four of 11 charges of fraud on Monday, in a case that came to symbolize the pitfalls of Silicon Valley’s culture of hustle, hype and greed. Image Elizabeth Holmes, center, entering the courthouse in San Jose, Calif., on Monday.
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