
Theranos CEO Says 'I Don't Know' 600+ Times in Deposition - kyleblarson
https://abcnews.go.com/beta-story-container/Business/theranos-ceo-elizabeth-holmes-600-times-broadcast-deposition/story?id=60576630
======
mabbo
George Shultz really comes off as a moron in all of this.

> 'They can try to convince me that you're wrong and in this case I do believe
> you’re wrong,'

Then he tricks his grandson into coming over to chat, and oh by the way
there's two lawyers from the company sitting in the next room with NDA
paperwork for you to sign.

Later, he manages to weasel out of ever saying "I was wrong".

> "Tyler’s handling of the troubling practices he identified at Theranos is an
> example. He did not shrink from what he saw as his responsibility to the
> truth and patient safety, even when he felt personally threatened and
> believed that I had placed allegiance to the company over allegiance to
> higher values and our family."

He didn't _believe_ it, you jackass, he witnessed it. Your retroactive history
lessons wherein you are actually the hero in all of this is astounding. I can
only hope Tyler Shultz has learned to stay the hell away from his grandfather.

~~~
Balgair
Everyone looks up to someone. I suggest that you look up to Tyler Schultz.

That guy stuck to his guns and faced a hell of a toll for it. He had his life
destroyed. He knew that was going to happen. He went ahead anyway.

Why? Because it was the _right thing to do_. Tyler saved countless lives, real
actual people's lives; Elizabeth and Sunny's greed and hubris undoubtedly
would have killed many people, no question.

Tyler Shultz is a hero.

Never let anyone tell you that you don't matter. Do the right thing.

Be like Tyler.

------
mcintyre1994
I doubt it's news to many here, but Bad Blood is an amazing book on Theranos.
It doesn't follow as far as the deposition (I had no idea she was facing 20
years!) but I'd highly recommend it for anyone interested in this story. The
audiobook is great too.

~~~
burtonator
I was listening to an interview with the author and he made a somewhat valid
point that it's part of the 'tech culture' to fake it until you make it.

However, at the same time apparently Larry Ellison was advising her. During
the early phase of Oracle's history one of their chief criticisms is over-
promising on timelines to keep existing customers on their product so that
they assumed something was going to ship in 90 days only to ship 1.5 years
later.

However, Theranos took this to the edge and just flat out lied about products
that they didn't have.

They were promising revolutionary breakthoughs not evolutionary.

~~~
tguedes
They fooled everyone. Idk if you read the book but they fooled EVERYONE. Their
board: included William Perry (former Secretary of Defense), Henry Kissinger
(former Secretary of State), Sam Nunn (former U.S. Senator), Bill Frist
(former U.S. Senator and heart-transplant surgeon), Gary Roughead (Admiral,
USN, retired), James Mattis (General, USMC), Richard Kovacevich (former Wells
Fargo Chairman and CEO) and Riley Bechtel (chairman of the board and former
CEO at Bechtel Group). Henry Kissinger was on their board!

Investors: by the Walton family ($150 million), Rupert Murdoch ($121 million),
Betsy DeVos ($100 million), the Cox family (of Cox Media Group) ($100
million), and Robert Kraft (of the New England Patriots).

You would figure there was no faking these people out. How do you dupe former
Secretary of States and Generals whom are supposed to be some of the most
stringent, dotting all the i's and crossing all the t's. It's just an amazing
story of how personality can change everything and cause people to have
massive blindspots.

~~~
samstave
Part of the reason she was able to fool such highly prominent people is due to
her coming from really old money in the US - with her Fleischmann's Yeast
family lineage - her family was in the upper echelons of US monied families
(think robber baron class-money).

~~~
emaginniss
Historically, yes, but her immediate family was not particularly wealthy,
lived a middle-class lifestyle, and was even in difficult financial straits at
times. I think they had the remnants of money on them, but not the actual
capital.

~~~
naniwaduni
An illustration of how wealth and power, inherited across generations,
consists of far more than just liquid assets.

------
kodablah
> But rather than a follow-up from Holmes, Shultz received an email, obtained
> by "Nightline," from Sunny Balwani.

> In the email, Balwani wrote in part: "...The reckless comment... based on
> absolute ignorance is so insulting to me that had any other person made
> these statements, we would have held them accountable in the strongest way.
> The only reason I have taken so much time away from work to address this
> personally is because you are Mr. Shultz’s grandson ... the only email on
> this topic I want to see from you going forward is an apology."

I hope to have my belief in karma bolstered by the results of the criminal
charges against Balwani. So often I've found at some point down the line this
kind of stuff catches up with people (if not criminally or financially, at
least in happiness).

~~~
dmix
If you read the book Bad Blood, Balwani makes Elizabeth look like a fumbling
fool by comparison while he's the evil tyrant building a culture of yes-men
and firing anyone with the least amount of dissent (and if you didnt work
12hrs/day). But I'm sure they were both nearly equally culpable. You never
really get insight on who (of the two) were the main drivers to start the
lying and eventual out-right fraud but it was very likely a mix of both.

There was a great story in the book about how the engineers would mess with
Balwani by repeating a random technical word that didn't make sense in
context, to see if he would start parroting it in his conversations. Which of
course he started doing, more than once. He was a fraud who knew nothing about
technology but thought he could manage an advanced technology project (which
is not too uncommon in silicon valley - but he did it to fraudulent levels and
like a dictator).

My intuition points to Elizabeth starting the snowball in motion - once she
over-promised, built a huge personal image, was in over her head - before it
turned into an avalanche from the work of Balwani. The person who had a
history of getting rich flipping useless companies with no value during the
dot-com boom. I hope he gets punished as much or more than Elizabeth.

And if I had to choose I'd 100x rather have worked for Elizabeth than Balwani.

~~~
SilasX
And if she had visited reddit or HN or any one of numerous sites they would
have repeated the meme that "no one knows what they're doing anyway, just fake
it till you make it", and she would have shrugged and kept on trucking.

~~~
kodablah
I don't believe this is true unless you are intentionally assuming all
ventures are painted with the same brush. It's not true with self driving
cars, med tech, or anything else having to do with human safety. Not only is
there not one shared voice on these sites, even if you pretended there were it
would not be in favor of faking it until you make it when human safety is
involved.

I think this subscribes to the more-frequent meme of assuming people apply
their mindset on some types of tech business to all types of tech business.

~~~
SilasX
I'm not talking about advice given about _ventures '_ viability, but to the
people running them, who, like Holmes, might say, "gee, I'm in way over my
head, I don't feel like I know what I'm doing" and are consistently told that
everyone feels that way so it doesn't matter.

~~~
kodablah
Yeah, about their little web service they are building. I don't think anyone,
here or elsewhere much less the majority of them, would say that advice is
globally applicable.

------
iaw
>Holmes forged ahead but was running out cash... This was in the midst of the
Great Recession. ... Holmes found someone to help. In 2009, she got an
enormous loan from a former software executive named Ramesh "Sunny" Balwani.

> "I think it was about $20 million." Holmes recalled to the SEC in a never-
> before-aired deposition obtained by "Nightline."

> there was another detail revealed that Holmes had been less forthcoming
> about: She admitted that she and Balwani had been living together and had
> engaged in a romantic relationship. It was something she admitted under oath
> but had kept from investors.

------
fargo
is the whole video available?

------
nartz
How do people think it will play out both tech-culturally and politically if
she gets convicted / acquitted?

If convicted, justice would be had but would it send a negative message to
entrepreneurs?

If acquitted, might it reinforce the "break things and move fast even if it
harms people mentality"?

~~~
amluto
> If convicted, justice would be had but would it send a negative message to
> entrepreneurs

I would consider a message that entrepreneurs are not above the law to be a
positive message.

~~~
Verdex
Hear hear. This is exactly the type of message that I want to be sent to
entrepreneurs. If you ruin people's lives and externalize your failures in
order to perpetuate fraud, then you'll go to jail.

Additionally, someplace out there is somebody with an idea that could allow
the single blood drop idea to actually work. That idea is going to get buried
because after Theranos, nobody is going to want to risk getting involved with
Theranos 2.0.

A conviction is the best possible thing for entrepreneurs who actually help
society and is only a negative thing to entrepreneurs who want to get rich by
stealing from others.

------
tmp092
Having worked in tech for a few years now, it's pretty clear that Holmes is
far from the only liar/sociopath/fraudster in the Valley. There's many just
like her.

~~~
lenticular
I suspect this wouldn't be as much of a problem in the valley if so many
investors and VCs weren't so incapable of critical thinking. The Juicero
debacle comes to mind.

edit: As someone coming into tech from physical science, I have never seen the
Dunning-Krueger effect anywhere like I do in tech. It's mainly in the
management, but folks do have a very serious problem accepting expertise from
scientists or engineers outside of tech industry.

~~~
sah2ed
Juicero was more of gross incompetence than fraud. The outcomes were similar,
but the root causes are not quite the same.

~~~
lenticular
Investors should have consulted researchers in the biomedical field before
investing. They would have told them that what Theranos was promising is
impossible. Everyone who invested in this fraud did not do their due
diligence.

~~~
emaginniss
I'm not sure why this is being downvoted when it is definitely true. Real
biomed companies were approached, but universally turned Theranos down because
they knew the limitations what what Theranos was attempting. In the face of
that rejection, Holmes turned to military/gov't people and investors with big
names, but no real healthcare clout.

------
objektif
God I am really scared that she will not go to jail somehow. I hope justice is
served.

------
blue4
Related, The Dropout is available on Spotify [1]

[1]:
[https://open.spotify.com/show/7lrJqILWfMuQhqDHJEFUK6](https://open.spotify.com/show/7lrJqILWfMuQhqDHJEFUK6)

------
dingaling
Wisdom is knowing when to say "I don't know".

It seems that she is very, very wise ..

------
jermaustin1
Is it purgury to say "I dont know" when you actually do?

~~~
Verdex
They would have to prove that you actually do. Also it might be the lesser
charge regardless, so it's worth it to take the chance.

For example, if there's an email with Holmes talking about how she's about to
lie by saying "I don't know" on the following issues that she totally knows
about, then if that's discovered, she's going to get charged.

However, that probably doesn't exist, so it's unlikely to otherwise prove that
she really does remember.

(Not a lawyer)

------
DigiMortal
She comes off as a grade-A sociopath, even more so after learning some of what
was done and her demeanor regarding it

------
buboard
I wonder if her investors ever had her psychiatrically evaluated.

------
devoply
is this news? if anyone was in her place they would do no less. it's likely
she's going to jail for at least a little while. who wants to go from
potential billionaire to jailbird? how would that effect your mental health?

~~~
ben_jones
Apparently Holmes is trying to raise money again [1]

[1]: [https://www.businessinsider.com/theranos-founder-
elizabeth-h...](https://www.businessinsider.com/theranos-founder-elizabeth-
holmes-new-startup-report-2018-6)

~~~
imjk
This is reminiscent of the story for Billy McFarland, the founder of the Fyre
Festival, who's currently serving a prison sentence for his acts. Even while
he was under investigation for fraud related to the failed festival, he moved
on to starting another scheme related to ticket scamming. There are two
related documentaries that recently came out - one on Hulu and the other on
Netflix - that are worth the watch if you're interested.

------
OmarGonzalez
Steve Job's legacy: the cult for sociopaths leaders

------
ilamont
_Whoever— (1) having taken an oath before a competent tribunal, officer, or
person, in any case in which a law of the United States authorizes an oath to
be administered, that he will testify, declare, depose, or certify truly, or
that any written testimony, declaration, deposition, or certificate by him
subscribed, is true, willfully and contrary to such oath states or subscribes
any material matter which he does not believe to be true; or (2) in any
declaration, certificate, verification, or statement under penalty of perjury
as permitted under section 1746 of title 28, United States Code, willfully
subscribes as true any material matter which he does not believe to be true;
is guilty of perjury and shall, except as otherwise expressly provided by law,
be fined under this title or imprisoned not more than five years, or both.
This section is applicable whether the statement or subscription is made
within or without the United States. (June 25, 1948, ch. 645, 62 Stat. 773;
Pub. L. 88–619, § 1, Oct. 3, 1964, 78 Stat. 995; Pub. L. 94–550, § 2, Oct. 18,
1976, 90 Stat. 2534; Pub. L. 103–322, title XXXIII, § 330016(1)(I), Sept. 13,
1994, 108 Stat. 2147.)_

[https://www.law.cornell.edu/uscode/text/18/1621](https://www.law.cornell.edu/uscode/text/18/1621)

------
candiodari
You realize that since 2-3 years it is now standard legal practice to make
sure deciders don't know the details of important decisions. They know the
decision, of course, and what was chosen, and they decide.

But they don't know who the email was sent to to implement the decision. Or
they don't know the law firm depositing it. Or they only generally know the
numbers involved, and have since destroyed the exact numbers (email and any
paper copies). This is done _explicitly_ so they can truthfully answer "I
don't know" to nearly every question.

Given how governments are going after companies, and how politicized
everything, including testimonies at the police, have become, I can't say I
blame them. Even if an answer is true, and not criminal, but somehow
controversial, it will end up in the media. I can't say I blame them. We need
to get back to the situation that it just doesn't happen that any statement
leaks from investigations, at the very least unless the person is found
guilty, and even then, only if strictly relevant to the crime.

For example the many times ceo's have been called to "testify" on tax
minimization strategies, knowing full well the IRS (controlled and of course
authorized by the government) has come to an agreement about those taxes, and
that agreement has passed through the hands of elected politicians. The only
purpose is to demonize these people without admitting that the government
created half the controversies.

~~~
JoeAltmaier
Anecdata: my sister proposed automated tire sensors for a trucking firm to the
President of said firm. They asked "If a tire comes off a truck on the highway
and causes an accident or fatality, will this sensor be able to show if the
tire was incorrectly mounted or had bad pressure?" She replied, "Yes,
exactly". They then said "Then we definitely don't want this on our trucks"
This was 15 years ago.

~~~
est31
That's because in the trucking industry, at least here in europe, there is
fierce competition. This means that companies that don't use material and
employees until their absolute limits are being filtered out by market forces.
The only way to improve the situation is by government involvement, both
through stricter laws and more regular controls. E.g. there are rules to
prevent exhaustion of truck drivers by mandating pauses for certain lengths.
Or in Germany there's a discussion now whether turning assistants should be
made mandatory or not.

