back to article Theranos blood-test machine demos for VIPs rigged to hide any failures, court told

Theranos blood-testing machines, which US prosecutors claim failed over 51 per cent of the time, provided no indication if things went awry during demonstrations for visitors, a court has heard. Seven weeks into the criminal fraud trial of Theranos founder and CEO Elizabeth Holmes, the feds are trying to show that Holmes, …

  1. Winkypop Silver badge
    Devil

    The ultimate vapour-ware trial

    May well end in tears

    1. ecofeco Silver badge

      Re: The ultimate vapour-ware trial

      We can only hope. Remember, this is America, where being rich and well connected means suffering far less consequences for your crimes.

      If any at all beyond embarrassment. At getting caught.

  2. a_yank_lurker

    Who's Who

    What struck me about Theranos was who was not investing. It seems like vultures in the biotech industry largely avoided getting heavily entangled. Theranos seemed more like a sophisticated Ponzi scheme; the payoff was always in indefinite future. Sounds good to those unfamiliar with medical testing, analytical chemistry, and related fields. But like any Ponzi scheme it could not continue indefinitely as the number of suckers needed exceeded the supply.

    1. Yet Another Anonymous coward Silver badge

      Re: Who's Who

      They were very careful to avoid bio-savy investors but targeted celebrities.

      That should have been a red flag for any investors who aren't idiots

      1. Youngone Silver badge

        Re: Who's Who

        Any company with an "all star board" like Theranos' is going to be trouble.

        They were all, at one point, retired military or politicians for some reason.

        1. Yet Another Anonymous coward Silver badge

          Re: Who's Who

          Some line about not spotting the sucker at the card table?

  3. Potemkine! Silver badge

    Last week, former Safeway CEO Steven Burd testified that Holmes had brought a Theranos machine with her to a 2011 meeting and he agreed to a finger-prick blood test. The machine reportedly made lots of noise but never produced a result.

    Nonetheless, Safeway struck a $85m deal with Theranos to test the machines and spent about $350m preparing its stores to offer rapid blood testing before it became clear Theranos couldn't fulfill its part of the partnership.

    How clever. So clever it's even suspicious.

    1. Anonymous Coward
      Trollface

      I wonder how much due diligence a company should do before committing nearly half a billion dollars.

      1. cyberdemon Silver badge
        Holmes

        due diligence

        How did they even manage to spend $350m on "making a space in the corner and putting a sign up", and maybe a bit of premature advertising..

        Yes I'm sure there's other stuff involved in "preparing their stores to offer rapid blood testing" but the figure sounds fishy to me, as if they are sweeping up other losses into their insurance/damages claim for their own lack of competence.

        Yes, theranos were charlatans, but as Pseudo said, you'd have to be pretty incompetent yourself to spaff that much money on the back of their dubious claims..

        1. John Brown (no body) Silver badge

          Re: due diligence

          Are there any common board members on the HP board? There may be a pattern here :-)

  4. sebacoustic

    sub-header

    ... should have been just been

    2> /dev/null

    for extra geek cred

    1. simonb_london

      Re: sub-header

      Still too noisy. Make that &>/dev/null. I'm trying to sleep here.

  5. lglethal Silver badge
    Trollface

    And Downey subsequently asked Edlin whether he was trying to deceive anyone, to which Edlin replied, "Of course not."

    followed by a number of winking emoji's, a couple of gifs of people looking suspiciously innocent/pretending to look innocent, and a large uproarious laughter soundtrack...

    1. John Brown (no body) Silver badge

      I don't think Edlin is capable of all that. Text only interface :-)

  6. M. T. Ness
    Thumb Down

    Arrogance of investors?

    If I were to invest millions of dollars in a microfluidics system for in vitro medical diagnostics, I would have insisted to see the details of the working principles like pumping and detection, and trivially: the storage of the reagents.

    The investors trusted their gut feelings, it seems, and did not ask the opinion of independent experts. Whatever happens next, serves them right.

    1. simonb_london

      Re: Arrogance of investors?

      Reminds me of when Peter Jones was duped into thinking that a TV takes tens of watts of power in standby and this power-saving gizmo was required to save the planet. They were doing the demo with an obsolete plasma TV that would keep the grid warm in standby for a fast start-up time. No TV still did that by the time of the pitch.

      1. NXM Silver badge

        Re: Arrogance of investors?

        That lie was repeated last week on Radio 4's Today Programme. As exposed on More or Less.

    2. Richocet

      Re: Arrogance of investors?

      It never ceases to amaze me about how little the average person knows about how things work, physics, or science. This is why we have investment bubbles. Even people with high to moderate wealth are rarely well-versed in these areas.

  7. Sgt_Oddball
    Coat

    This is what happens

    When you deal with pricks...

    I'll get my lab coat...

  8. WanderingHaggis
    Devil

    Am I being too harsh?

    The "accidental destruction" of evidence should set a legal presumption of guilt and require the defendants to prove their innocence.

    1. Richard 12 Silver badge

      Re: Am I being too harsh?

      Post-subpoena should invite a contempt charge, regardless of anything else.

    2. Drew Scriver

      Re: Am I being too harsh?

      In the US, it usually does exactly that.

      1. Anonymous Coward
        WTF?

        Re: Am I being too harsh?

        Unless you're rich and connected.

    3. Yes Me Silver badge
      Facepalm

      Re: Am I being too harsh?

      Well, anybody can do rm -fr * by accident. Is that a crime?

      Doing it on the backup system too would also just be carelessness.

  9. Chris G

    I wonder how much of that $700 million from investors is being sucked up by the defending lawyers?

    1. Gordon 10

      Depends if Holmes siphoned any off prior to the collapse. Presumably she is being tried as an individual.

    2. Steve Button Silver badge

      None of it, as the lawyers are being paid for by insurance apparently. (otherwise the creditors would have got in there first)

    3. Richocet

      Yes, they need to do something about that.

      The steal a bunch of money and spend it to the last cent if necessary defending yourself against charges of stealing - routine is far to common.

      The person whose money was allegedly stolen has next to no chance of getting any of it back which is unfair.

  10. Anonymous Coward
    Anonymous Coward

    Did the Balawani email reported both the lab results and the machine results for a real comparison?

    Or was that just an assertion by someone who will be tried for the same fraud as Holmes?

    Were the data into the database that has been made non accessible?

    Of course Edlin won't admit he had deceived investors himself deliberately - that could put him in a far worse position... after all "rigged" demo machines are not so rare, and Magic Leap is not yet in a court....

  11. Pascal Monett Silver badge
    Facepalm

    Unbelievable

    He got a demo that didn't produce any results, and he still gave them millions.

    No wonder con artists continue to make a living these days.

    You want my money ? You'd better show me a working product. Not necessarily a finished one, but at least a working one.

    1. You aint sin me, roit
      Coat

      Indeed, demo != prototype

      I'd be very suspicious of a demo that can't even printf("Success!").

    2. Mike 16

      Re: Unbelievable

      A working Product? Takes me back to the days when game consoles were occasionally cloned.

      One such clone producer demoed a working product at CES, until someone peeked and saw that the "working product" was an empty box with a cable running under the table to the original device.

      EDLIN? I was wondering where that name came from.

    3. Man inna barrel

      Re: Unbelievable

      On several occasions, I came across software/firmware engineers, who would start a project by writing a flashy interface, that made it look like the product was doing something useful. In fact, what I call the "engine room" code was virtually empty, without even some proof of principle code to test the feasibility of the product. All the product behaviour was simulated, i.e. faked.

      The trouble is, this mislead the non-technical management into thinking that the product was nearly ready, whereas there was still much work to be done to actually make it work. One guy had done a nice demo for the customer, but then hacked about the code so it no longer "worked", without at least making an archive of the previous demo code. He then went on holiday. While the developer was away, the customer wanted to know about progress, but we could not get anything working, and close examination of the code revealed that no real progress had been made. The customer was not impressed. The developer was sacked, and my colleague rewrote the whole lot.

      This flashy demo first approach did seem fairly common at the time (1990s). Maybe it was how people were taught. My colleague and I worked in a totally different way: start with the engine room code, to prove the product is going to work. You can always tart up the interface later. There is always the possibility that the product concept is not feasible, and the sooner you find that out, the less money is wasted.

  12. KBeee
    Joke

    Appropriate

    "New York Times reporter Erin Woo"

    Woo seems like an appropriate name for investigating Theranos' Magic Machine

    1. ecofeco Silver badge

      Re: Appropriate

      Sometimes the universe has a sense of humor.

      1. Anonymous Coward
        Anonymous Coward

        Re: Appropriate

        A recent news story about a pensioner and their garden getting covered from above by airplane toilet poop was reported in several news sites by a journalist named Kevin Doody.

    2. G40

      Re: Appropriate

      Surely edlin takes the biscuit …

      1. Throatwarbler Mangrove Silver badge
        Coat

        Re: Appropriate

        Sure, he can vi for the privilege.

        1. Jonathan Richards 1
          Thumb Up

          Re: Appropriate

          :q!

          1. Mike 16

            Re: Appropriate

            You may need to escape first.

    3. TRT Silver badge

      Re: Appropriate

      There was certainly bad blood between them though.

  13. Drew Scriver

    I have seen so many fake demos and corporate dog/pony smoke/mirrors that I can't even remember all of them.

    This one is the most expensive one I've heard about though.

    1. Man inna barrel

      I am fairly sure there are some startups that are formed primarily to attract funds from investors, rather than to develop and produce something useful, for a profit. Some people have an extraordinary talent for blagging money out of people who should know better. I think most venture capitalists are aware of this. It is just a risk of doing business. What they bet on is a few star performers paying for all the duds. A lot of this probably is not fraudulent, as the Theranos case is alleged to be. It is nonetheless very wasteful.

  14. david 12 Silver badge

    The two court documents linked regard the dispute between the parties about if Carreyrou, a reporter, should be allowed to report the trial.

  15. Anonymous Coward
    Anonymous Coward

    Whether she serves time depends on who got bilked. If it was someone with connections, time will be involved. If not, count on a slap on the wrist for a "white collar" crime that "didn't hurt anyone." :(

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