After nearly three months of trial, 32 witnesses and more than 900 exhibits, the 12-person jury in the former Theranos CEO Elizabeth Holmes trial, is deadlocked. At the time of this writing, they have deliberated for four days, and cannot reach a verdict. They will resume after the new year.
Interestingly, I have heard from my followers on both sides of the issue who are proclaiming some type of victory:
“Chuck, a deadlocked jury means she’s innocent – and she rocks!”
“Chuck, a deadlocked jury means the fix was in, and no one had the courage to do the right things!”
“Whoa, Nellie”
This seems a good time to remember the iconic phrase of the late great sports announcer, Keith Jackson. The phrase can be interpreted in many ways, but to me it has always meant “OK, let’s stop for an instant, realize what is happening, and understand what we’re seeing.”
From the beginning of our blog series on the Theranos trial, one of my points of emphasis has been that ethics is on trial here and it is ethical behaviors that demand our attention, neither our feelings nor our sense of logic. Also, no one reading this post will have been on the jury. We did not hear the testimonies nor the way in which they were delivered.
According to Newsweek (December 27, 2021):
“The jurors sent two notes to U.S. District Judge Edward Avila the prior week. One was a request to take their instructions home for further study, which was quickly rejected. Another allowed them to again listen to a 2013 recording of Holmes discussing Theranos’ dealings with potential investors, which they first heard in late October.”
The jury needs clarification and reflection. The Theranos debacle cost investors more than $900 million. There are 11 counts of fraud and a conspiracy of deception. Elizabeth Holmes could potentially face 20 years in federal prison.
Lady Justice
The thing about Lady Justice is that in a perfect setting, “she” will listen, observe and then sit in judgment. However, the setting is far from perfect. Lawyers for both the prosecution and defense are (often) highly trained to obfuscate the truth.
A victory for Holmes clearing her of all charges or a victory for the prosecution locking Holmes away for many years, should not necessarily be celebrated. For in the larger picture, there is no clear-cut winner no matter which way the jury will adjudicate.
If we celebrate a Holmes victory, what does it say for $900 million in losses? Does it say that it is acceptable to dupe investors? Obviously not. Minimally, it says that corporate and private investors and board members plunged into a “healthcare play” without so much as proper due diligence.
Elizabeth Holmes made huge promises and was resolute in her hypothetical convictions. The equipment she touted didn’t work, never worked. The endorsements she presented were fake. However, it was up to someone – somewhere, to say “We need a much closer look with our own experts.” Also, let’s not forget there were whistle blowers along the way that seem to have been wholly or partially convinced that whatever was being touted was a myth.
On the other hand, if we celebrate Elizabeth Holmes trudging off to prison in shackles, what does that say for “100 other” Silicon Valley scams where the CEOs and CFOs got away with billions? Even Holmes’ idol Apple founder Steve Jobs, was clearly not known for having a pristine reputation. Yet, he survived as did Bill Gates, Mark Zuckerberg and many, many more. Do we want to vilify Elizabeth Holmes as make-up for everything that has been wrong with hi-tech and biotech?
Blood in the Water
Whether you love or despise Elizabeth Holmes, it is wise to understand that the unethical Silicon Valley scam game has been going on for decades. A young upstart (Holmes was only a 19-year-old college dropout when she emerged on the scene), when she extolled the new technology with sidekick Ramesh “Sunny” Balwani, people jumped at the chance to follow her vision. Many never jumped off, even after they realized the technology was a joke. Many engaged in the unethical act of covering up the flawed technology.
Whether Safeway or Walgreen’s, major investors or healthcare professionals had, for a moment said “No,” this entire game could have been put to an end. They didn’t.
Ultimately, if Elizabeth Holmes is disgraced, many others should be disgraced along with her. If she is exonerated, it is not a victory. And, if there are any positive ethical outcomes, it just might be that investors and the media will respond instead of react; will thoroughly research instead of jumping into the water with the sharks.
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