It is the downfall of a true fake icon of science and technology. Elizabeth Holmes, a former star of Silicon Valley, home to many tech companies in California, which promised to revolutionize blood testing with her start-up Theranos, was convicted on Monday of fraud by a court in this western state. . The sanction is rare in the world of “tech” where disillusions are however commonplace.
After more than three months of trial and seven days of deliberation, the jury of the San José court found her guilty of defrauding investors but acquitted her of certain charges and was unable to come to grips with it. ‘agreement on other facts with which he was accused. This conviction exposes the 37-year-old woman to several decades in prison, but the sentence will be pronounced at a later date by the federal court.
The verdict “reflects the guilt of Mrs. Holmes in this large-scale fraud,” said prosecutor Stephanie Hinds in a statement read out of court by a representative. Elizabeth Holmes remains free on bail, a measure the terms of which are to be reviewed next week. Pressed to say if she intends to appeal her conviction, the fallen boss made no comment when she left court.
The promise of faster, cheaper and more diagnostics
She founded Theranos in 2003, at just 19, and promised faster and cheaper diagnostic tools than traditional labs. With the help of a careful story, she has managed in a few years to gain the trust of luminaries and to raise funds from prestigious investors, attracted by the profile of this young woman, a rarity in the male world of Californian engineers. .
In particular, at the start of the 2010s, she wore a black turtleneck sweater in explicit reference to the founder of Apple, Steve Jobs, to whom the world of “tech” constantly compared the young entrepreneur when she was. at the height of his glory. Former Secretary of State Henry Kissinger backed her, as did former Defense Minister James Mattis or media mogul Rupert Murdoch, who invested more than $ 100 million (around € 85 million) in Theranos. At its peak, the company is valued at nearly $ 10 billion (around 8.5 billion euros), and Elizabeth Holmes, the majority shareholder, is at the head of a fortune of 3.6 billion (regarding 3 , 1 billion euros), according to Forbes magazine.
The story was beautiful. As a child, she hated needle pricks during blood tests. She therefore invents a simple, fast and efficient machine that allows everyone to carry out hundreds of blood diagnoses from a single drop of blood taken from the fingertip. But, in 2015, the Wall Street Journal revealed the immense pot aux roses: the fabulous machine promised by Theranos never worked.
“Pretend until you get there”
Outside the San José court where the trial opened in early September 2021, a pregnant woman recounted how she mistakenly believed she had miscarried following using one of Theranos’ tests. Employees testified that they warned the boss of their doubts regarding the operation of the machines. Some have also told the press regarding Elizabeth Holmes’ repeated lies to her teams and to investors. For some, she embodied this Silicon Valley mantra: “fake it till you make it”.
Elizabeth Holmes pleaded this good faith in court. “We were on the right track to accomplish our goals” before the business collapsed, “she said at the helm. “Failure is not a crime, to persevere and not to achieve it is not a crime”, for his part launched his lawyer, Lance Wade, at the beginning of the trial. “Mrs. Holmes tried to the end to save her company, never selling a share”, added her council, wanting as proof of the good faith of her client the fact that she “sank with the boat”.
The prosecution made a whole different reading of this fairy tale that turned into a financial nightmare. “Mrs. Holmes chose fraud rather than bankruptcy, she chose to be dishonest,” said prosecutor Jeff Schenk in his requisitions. “This choice was not only ruthless but also criminal”, he launched to the jurors. According to the prosecutor’s office, the former entrepreneur deliberately deceived her partners to raise funds, more than 700 million dollars in all (just over 600 million euros).
In response, Elizabeth Holmes assured jurors that her romantic relationship with her ex-director of operations, Ramesh “Sunny” Balwani, who will be tried separately, was peppered with forced sex and that he was responsible for the technical problems. of his business.